TGIF:
This week has closed with a bang. A Federal Open Market Committee decision last night, more Brexit news than you can shake a stick at and a Euro that just can’t make up its mind all added to the confusion. This morning, DUP leader Arlene Foster kicked Sterling markets into a spiral with the Pound soon trading below 1.30 against the Dollar. Pushing the losses within cable to a little over 1.5 percent in 48 hours, the leader of the Northern Irish party said that May could not count on her party’s support on the incumbent Brexit deal. The Northern Irish politician slammed May’s Brexit plan, as a move against the Union and a danger to the stability of the United Kingdom. The move was less pronounced against an already subdued Euro, allowing EURGBP to continue its descent through 0.87. The Fed’s interest rate decision last night left the US Dollar virtually unchanged. Ahead of the event, futures markets attached an 80% probability of a 25-basis point interest rate hike at their December meeting. Following the event, the situation and market expectations remained almost entirely unchanged. Unsurprisingly, therefore, treasury yields were little changed with the US and Asian session last night leaving the value of the US Dollar unchanged. At market open in Europe this morning, there was a different story, with the greenback closing some 0.4% stronger than its rate at market open this morning. Moving into the weekend, any development on Brexit will continue to determine the Pound’s value.
Discussion and Analysis by Charles Porter
Next level EURUSD has managed a relatively smooth ascent to its current levels, around 1.18. That is despite significant resistance levels, most notably around 1.17. A large collection of option strike prices gathered around this key level and the price history of the pair shows us its significance. Sustained closes above this level since last […]
A weaker Dollar: Trump vs. Powell The Dollar continued to lose ground yesterday as the truce between Israel and Iran appeared to continue to hold. There has been a noticeable return to focus upon macro and monetary influences in major currency pairs. Yesterday, Fed Chair Jay Powell provided his semi-annual monetary policy report before the […]
Whiplash A highly volatile start to yesterday’s trading session saw a flight to safety in markets. Despite the Dollar having lost much of its appeal as a safe haven lately, there was still an identifiable USD bid prior to and during the European open. We have identified recently how markets have clearly differentiated between general […]