Euro Heads Toward a Make-or-Break Policy Week Versus Sterling

Euro Heads Toward a Make-or-Break Policy Week Versus Sterling Euro Heads Toward a Make-or-Break Policy Week Versus Sterling

(Bloomberg) — The euro’s January consolidation against the faces a test next week, when the European Central Bank meets and U.K. data may decide whether the Bank of England cuts interest rates.

Options traders see a low risk so far for a breakout from the pair’s month-long range and volatility remains suppressed, keeping hedging costs low for those taking no chances. Attention will be on Thursday’s outline of the ECB’s strategic review, particularly its implications for shifting the outlook among policy makers. That will be followed by the U.K. Purchasing Managers Indexes for January on Friday.

While the ECB is just expected to monitor the impact of its policy so far, money market traders have started to assign a higher probability for a BOE cut, with current pricing at around 75% for a move at its Jan. 30 meeting. A combination of dovish comments from officials and soft U.K. data has weighed on the pound recently, yet the euro has been unable to significantly benefit, with rallies versus the dollar met this week by profit-taking interest.

The euro reversed early losses versus sterling on Friday and stood at 85.21 pence per euro after data showed that U.K. retail sales unexpectedly fell in December. One-week implied volatility trades at 6.28%, near the lower end of its range since early 2018 and compared to a past-year average of 7.76%. The breakeven into next week’s events currently stands at 64 pound pips, according to Bloomberg pricing, suggesting traders are not expecting any fireworks next week.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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Forex – Sterling Slips vs Dollar, Euro as Vlieghe Fuels Rate Hopes

© Reuters.  © Reuters.

Investing.com — The dollar opened the week stronger against the and the Japanese , but weaker against the euro, with markets still unsettled by the weak labor market report on Friday.

The , which measures the greenback against a basket of currencies, was effectively unchanged at 3:10 AM ET (0810 GMT) at 97.130. However, that masked a 0.5% rise for the dollar against sterling, which continued to suffer from speculation on an interest rate cut from the Bank of England. The was up marginally at $ 1.1128.

Speeches by Governor Mark Carney and Monetary Policy Committee member Silvana Tenreyro last week had encouraged hopes of a cut. Over the weekend, another MPC member Gertjan Vlieghe, had signalled in an interview with the Financial Times that he would also back a rate cut barring “an imminent and significant improvement in the U.K. data.”

Vlieghe will get his chance to judge on that at 4:30 AM ET (0930 GMT) with the latest update on and its components, along with data for November. The National Institute of Economic and Social Research publishes its later at 9 AM ET (1400 GMT).

“Sterling seems to be caught between the bid from the under-weight asset managers and some speculators seeing the Brexit uncertainty lifted on the one hand, and the under-appreciated risks of a rate cut and a no-deal Brexit still on the other,” said Marc Chandler, managing partner of Bannockburn Global Forex. He sees a near-term range of $ 1.2900-$ 1.3200 for Cable.

The continued unrest in Iran over the weekend appears to have had little impact on broader sentiment, which is firmly in risk-on mode as the risk of war with the U.S. recedes and the signing of the preliminary trade agreement between China and the U.S. – scheduled for Wednesday – draws nearer.

The broke through 6.90 to the dollar for the first time in five months overnight, while the rose to a 20-month high. The dollar also continued to lose ground against other barometers of risk appetite such as the Indonesian and Turkish .

Analysts at Nordea pointed to the incongruity of sharply rising emerging market currencies, given the consistently weak numbers coming out of global purchasing manager indexes.

“Either EM FX and equities are too expensive or else the global manufacturing PMI is about to explode higher. It is do or die time,” analysts Andrea Steno Larsen and Martin Enlund said. “It’s very hard to find a trigger for a weakening market at present (outside of Iran maybe) but maybe that is a worrying sign in itself?”

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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Yuan and Aussie off four-month high, sterling ticks up

By Hideyuki Sano

TOKYO (Reuters) – The and the Australian dollar hovered below four-month highs touched last week in early Monday trade as investors pored over the U.S.-China trade deal, while sterling stayed strong after a decisive UK general election.

Washington and Beijing cooled their trade war last week, reducing some U.S. tariffs in exchange for what U.S. officials said would be a big jump in Chinese purchases of American farm products and other goods.

The last-minute agreement that averted additional tariffs on Chinese goods totaling $ 160 billion had lifted the yuan and the Australian dollar and had pushed down the safe-haven yen and the dollar last week, before profit-taking set in.

“It is not that markets are unhappy with the agreement but we will inevitably see some position adjustments as we approach the year-end holiday period,” said Yukio Ishizuki, senior strategist at Daiwa Securities.

The traded at 7.0026 yuan per dollar , slipping back from a four-month high of 6.9247 per dollar hit last week.

The trade-sensitive Australian dollar fetched $ 0.6876 , easing from Friday’s four-month high of $ 0.6930

The euro stood at $ 1.1126 (), up 0.05% so far in Asia, off four-month peak of $ 1.1200 set in Asian trade on Friday.

The dollar traded at 109.40 yen , having risen to 109.71 yen on Friday.

Some analysts also noted investors may need to read the fine print of the deal, which has yet to be officially signed.

U.S. Trade Representative Robert Lighthizer said on Sunday the deal will nearly double U.S. exports to China over the next two years and is “totally done” despite the need for translation and revisions to its text. A date for senior U.S. and Chinese officials to formally sign the agreement is still being determined, he added.

“We have seen over time more reports about the differences between what U.S. said and what China said about the agreement,” said Takafumi Yamawaki, head of fixed income research at JPMorgan (NYSE:) Securities in Tokyo. “The U.S. talks about the size of U.S. farm products China will buy but China stayed mum.”

Many traders were also skeptical whether there will be any another deal after the latest one, which the Trump administration has called “phase one”, given the fundamental differences over key issues such as intellectual property rights.

Elsewhere, sterling gained 0.2% in early Asian trade on Monday to $ 1.3353 .

It has risen to $ 1.3516 on Friday, a high last seen in May last year, after British Prime Minister Boris Johnson won a commanding election victory last week, enabling him to end three years of deadlock over Brexit.

Johnson’s government is expected to bring the Withdrawal Agreement Bill back to parliament before Christmas, to allow Britain to exit the European Union by Jan. 31.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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Sterling sparkles after election poll, yuan up on trade deal reports

By Stanley White

TOKYO (Reuters) – The pound rose to a three-and-a-half year high versus the euro and the highest in more than a year versus the dollar after exit polls suggested a win for the Conservatives, which should help ensure the UK’s smooth exit from the European Union.

The rose in offshore trade and the Japanese yen fell after a source told Reuters that the United States and China have agreed some tariff reductions and a delay on tariffs set to go effect on Dec. 15.

The early results suggest the election will relieve almost four years of uncertainty about when Brexit would take place, which should be supportive of the pound.

A successful scaling back of trade tension would relieve one major headwind to economic growth, which suggests lower demand for the safe-haven yen. Avoiding new tariffs should also be a boost to China’s slowing economy, which should draw more investors to the yuan.

“We’ve already seen a strong reaction in the pound from the exit poll,” said Michael McCarthy, chief market strategist at CMC Markets in Sydney.

“We also see a rise in stock futures in reaction to two very important pieces of news for markets. This should support global growth. The yuan can also go higher, but it depends on how much dollar strength we get.”

Against the euro, sterling () rose around 2% to as high as 82.80 pence, the highest since July 2016, which is shortly after the Brexit referendum that hammered the currency.

The pound surged by 2.2% to $ 1.3474, reaching the highest since May 2018.

The pound plunged more than 10% in the immediate aftermath of Britain’s vote to leave the European Union in June 2016, while $ 2 trillion was wiped off world markets.

The exit poll, which suggested UK Prime Minister Boris Johnson would get a majority of 86 – the largest of any Conservative leader since Margaret Thatcher won in the 1980s – should empower him to deliver Brexit on Jan. 31.

Official results will be declared over the next seven hours.

Even if Brexit is completed on Jan. 31, there is still some uncertainty because Britain will then enter a transition period during which it will negotiate a new relationship with the remaining 27 EU states.

In the offshore market, the Chinese yuan rose 0.33% to 6.9273 per dollar, after surging on Thursday to the highest since Aug. 1 due to relief about a resolution to trade friction.

As part of the trade deal, China has also agreed to purchase $ 50 billion of U.S. agricultural goods next year, sources familiar with the talks told Reuters.

The yuan rallied and the yen fell late on Thursday after Bloomberg News reported that U.S. President Donald Trump signed off on a trade deal with China that will delay a new round of tariffs scheduled for Dec. 15.

A trade dispute between the United States and China over Chinese trading practices that Washington says are unfair has dragged on for almost two years, making the stand off the biggest risk to the global economy.

Against the dollar, the yen fell to 109.595, the weakest since Dec. 2.

The () against a basket of six major currencies fell 0.35% to 96.736, approaching the lowest since July this year.

Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh

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Sterling sparkles after election poll, yuan up on trade deal reports

© Reuters. The Wider Image: African churches boom in London's backstreets © Reuters. The Wider Image: African churches boom in London’s backstreets

By Stanley White

TOKYO (Reuters) – The pound rose to a three-and-a-half year high versus the euro and the highest in more than a year versus the dollar after exit polls suggested a win for the Conservatives, which should help ensure the UK’s smooth exit from the European Union.

The rose in offshore trade and the Japanese yen fell after a source told Reuters that the United States and China have agreed some tariff reductions and a delay on tariffs set to go effect on Dec. 15.

The early results suggest the election will relieve almost four years of uncertainty about when Brexit would take place, which should be supportive of the pound.

A successful scaling back of trade tension would relieve one major headwind to economic growth, which suggests lower demand for the safe-haven yen. Avoiding new tariffs should also be a boost to China’s slowing economy, which should draw more investors to the yuan.

“We’ve already seen a strong reaction in the pound from the exit poll,” said Michael McCarthy, chief market strategist at CMC Markets in Sydney.

“We also see a rise in stock futures in reaction to two very important pieces of news for markets. This should support global growth. The yuan can also go higher, but it depends on how much dollar strength we get.”

Against the euro, sterling () rose around 2% to as high as 82.80 pence, the highest since July 2016, which is shortly after the Brexit referendum that hammered the currency.

The pound surged by 2.2% to $ 1.3474, reaching the highest since May 2018.

The pound plunged more than 10% in the immediate aftermath of Britain’s vote to leave the European Union in June 2016, while $ 2 trillion was wiped off world markets.

The exit poll, which suggested UK Prime Minister Boris Johnson would get a majority of 86 – the largest of any Conservative leader since Margaret Thatcher won in the 1980s – should empower him to deliver Brexit on Jan. 31.

Official results will be declared over the next seven hours.

Even if Brexit is completed on Jan. 31, there is still some uncertainty because Britain will then enter a transition period during which it will negotiate a new relationship with the remaining 27 EU states.

In the offshore market, the Chinese yuan rose 0.33% to 6.9273 per dollar, after surging on Thursday to the highest since Aug. 1 due to relief about a resolution to trade friction.

As part of the trade deal, China has also agreed to purchase $ 50 billion of U.S. agricultural goods next year, sources familiar with the talks told Reuters.

The yuan rallied and the yen fell late on Thursday after Bloomberg News reported that U.S. President Donald Trump signed off on a trade deal with China that will delay a new round of tariffs scheduled for Dec. 15.

A trade dispute between the United States and China over Chinese trading practices that Washington says are unfair has dragged on for almost two years, making the stand off the biggest risk to the global economy.

Against the dollar, the yen fell to 109.595, the weakest since Dec. 2.

The () against a basket of six major currencies fell 0.35% to 96.736, approaching the lowest since July this year.

Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh

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Kiwi leads faint risk rally, Brexit promise lifts sterling

By Tom Westbrook

SINGAPORE (Reuters) – The dollar and export-focused currencies found support on Monday as positive signs for the U.S. economy and upbeat headlines on U.S.-China trade talks boosted investor confidence.

The pound climbed, too, on hopes for an imminent Brexit and an end to years of political paralysis.

The day’s mood – tempered with weariness at the flow of trade news – was best illustrated by the New Zealand dollar. It rose 0.4% against the safe-haven Japanese yen () to 69.83 yen.

“Even if the numbers are small, there’s a message in there that risk appetite has improved,” said Westpac FX strategist Sean Callow.

The dollar added 0.1% on the yen to 108.76 yen and touched its highest level since Nov. 14 against the euro () at $ 1.1012. It sat at 98.278 against a basket of currencies, just below a two-week high ().

Sterling rose 0.1% to $ 1.2847, after British Prime Minister Boris Johnson, whose Conservative Party leads in opinion polls ahead of the Dec. 12 election, promised to bring a deal to leave the European Union to parliament before Christmas.

“The markets are holding on to any sort of positivity we get at the moment,” said Sean MacLean, research strategist at Pepperstone, a brokerage in Melbourne. “We want to keep that momentum going.”

Keeping hopes for a breakthrough in trade talks alive was the weekend announcement of Chinese plans for improving protection of intellectual property rights – seen as a move to address a sticking point between the parties.

U.S. national security adviser Robert O’Brien also said on Saturday a deal was possible by year’s end.

On the economic front, the greenback was buttressed by better-than-expected U.S. manufacturing data on Friday, seen as staving off the need for a rate cut. The main check on confidence has been rising tensions over Hong Kong.

The city has been rocked by more than five months of anti-government protests, and Beijing has already reacted angrily to the passage of U.S. legislation backing protesters, which has cleared Congress but not been endorsed by President Donald Trump.

“The price of the ‘Hong Kong bill’ will be increased underlying U.S.-China tensions,” said Vishnu Varathan, head of economics and strategy at Mizuho Bank in Singapore, adding that means greater uncertainty around the trade deal.

Nevertheless, the day’s optimistic sentiment was enough to lift the trade-exposed Australian dollar 0.2% higher on the greenback to $ 0.6796, and for the New Zealand dollar to gain 0.3% to $ 0.6421.

China’s yuan strengthened slightly to 7.0356.

Later in the trading day focus is expected to shift to German service-sector data and a speech from the European Central Bank’s Chief Economist Philip Lane at 1800 GMT.

U.S. Federal Reserve Chairman Jerome Powell’s makes a speech at 0000 GMT.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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Dollar boosted by trade progress signs, Brexit promise lifts sterling

By Tom Westbrook

SINGAPORE (Reuters) – The dollar and export-focused currencies edged higher on Monday on broadly upbeat headlines about U.S.-China trade talks, while the pound climbed on hopes of an imminent Brexit and an end to years of political paralysis.

Moves were marginal, however, as scepticism and weariness of newsflow about both U.S.-China trade negotiations and Brexit kept investors cautious.

Sterling rose 0.2% to $ 1.2854 in Asian trade, lifting it from an almost two-week low hit on Friday following surveys showing businesses in their deepest funk since 2016.

The greenback, also supported by positive economic data released late last week, rose 0.1% on the safe-haven Japanese yen to 108.78 yen. The euro () was steady at $ 1.1021 while the Australian and New Zealand dollars ticked higher.

Against a basket of currencies () the dollar was steady at 98.258.

“The markets are holding on to any sort of positivity we get at the moment, we want to keep that momentum going,” said Sean MacLean, research strategist at Pepperstone, a brokerage in Melbourne.

British Prime Minister Boris Johnson, whose Conservative Party leads in opinion polls ahead of the Dec. 12 election, supported the pound with a promise to “get Brexit done” and bring a deal to leave the European Union back to parliament before Christmas. [nL8N284073]

Keeping hopes for a breakthrough in trade talks alive was the weekend announcement of Chinese plans for improving protection of intellectual property rights – seen as a move to address a sticking point between the parties. [nL4N28406V]

Chinese President Xi Jinping said on Friday that he wants to reach an agreement, while U.S. President Donald Trump said progress was going well. U.S. national security adviser Robert O’Brien said on Saturday a deal was possible by year’s end. [nL1N2830Q1] [nL3N2821H4]

Rising tensions over Hong Kong, however, have emerged as a fresh complication in the trade talks, that have otherwise appeared to make slow progress.

The city has been rocked by more than five months of anti-government protests, and Beijing has already reacted angrily to the passage U.S. legislation backing protesters, which has cleared Congress but not yet been endorsed by Trump.

“The price of the ‘Hong Kong bill’ will be increased underlying U.S.-China tensions,” said Vishnu Varathan, head of economics and strategy at Mizuho Bank in Singapore, adding that means greater uncertainty around the trade deal.

Nevertheless, the optimistic sentiment was enough to lift the trade-exposed Australian dollar 0.2% higher to $ 0.6797 and the New Zealand dollar to $ 0.6415.

China’s yuan strengthened 0.1% to 7.0360 in offshore trade.

Later in the trading day focus is expected to shift to German service-sector data and a speech from the European Central Bank’s chief economist Philip Lane at 1800 GMT, ahead of U.S. Federal Reserve Chairman Jerome Powell appearance at 0000 GMT.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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Sterling holds gains as Brexit Party pledge eases hung parliament fears

© Reuters. FILE PHOTO: Euro, Hong Kong dollar, U.S. dollar, Japanese yen, pound and Chinese 100 yuan banknotes are seen in this picture illustration © Reuters. FILE PHOTO: Euro, Hong Kong dollar, U.S. dollar, Japanese yen, pound and Chinese 100 yuan banknotes are seen in this picture illustration

By Tomo Uetake

TOKYO (Reuters) – Sterling held gains in Asian trade on Tuesday, having hit a six-month high versus the euro and rising as much as 1% against the dollar overnight, as the risk of a hung parliament in UK elections eased slightly.

In a significant boost for Prime Minister Boris Johnson ahead of the Dec. 12 election, Brexit Party leader Nigel Farage said his party was standing down candidates in seats won by the Conservatives in 2017 and would instead focus on challenging anti-Brexit politicians.

The pound rallied to as high as $ 1.2896 on the news, which the market had interpreted as reducing the probability of a hung- or Labour led- government that would further complicate Britain’s exit from the European Union.

Cable gave up some of its overnight gains and was last at $ 1.2858 .

Sterling had already risen above $ 1.28 before Farage’s announcement, after data showed the UK economy had narrowly missed a recession in the third quarter of 2019, expanding 0.3%.

Against the euro, the sterling strengthened to its highest level since May 8, at 85.62 pence (). The pair last stood at 85.79 pence.

Currency analysts said the Brexit Party standing down candidates could clear the way for the Conservatives to pass their Brexit withdrawal deal.

“The sterling’s move was notable while other currencies were quiet, mainly because the U.S. market was closed,” said Ayako Sera, market strategist at Sumitomo Mitsui Trust Bank.

The U.S. financial markets were partially closed on Monday for Veterans Day.

“It certainly is positive that the Conservatives got greater support. But with a month to go ahead of the Dec. 12 election, I’m not all that optimistic because I think anything can still happen,” Sera said.

The euro/dollar last changed hands at $ 1.1033 (), flat on the day, while the greenback was a shade higher at 109.15 yen .

“The dollar’s recent rally on the back of rising Treasury yields paused yesterday as the U.S. cash bond market was closed for Veterans Day,” said Mitsuo Imaizumi, chief currency strategist at Daiwa Securities.

Also weighing on the U.S. currency were doubts about whether Beijing and Washington can reach a potential trade agreement and roll back tariffs, and concerns over rising Hong Kong tensions.

Caution ruled ahead of a speech by President Trump to the Economic Club of New York later in the day in case there was any new word on the Sino-U.S. “phase one” trade deal.

In Hong Kong, riot police fired tear gas at a university campus on early Tuesday, a day after a protester was shot and a man set on fire in some of the most dramatic unrest to rock the Chinese-ruled city in more than five months.

The was little changed at 7.0040 per dollar in offshore trade , with traders awaiting developments on trade as well as Hong Kong.

Elsewhere, the New Zealand dollar slipped as traders wagered on a higher probability of a rate cut this week after a central bank survey on Tuesday showed the country’s near-term inflation expectations eased in the fourth quarter.

The New Zealand dollar skidded as mus as 0.6% to $ 0.6326 after the Reserve Bank of New Zealand’s quarterly survey of expectations. It last quoted at $ 0.6333.

As a reduction to the official cash rate by the RBNZ will add pressure on its Australian counterpart to ease too, the dollar also dipped to as low as $ 0.6832.

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Forex – Dollar Steady as Trade Developments Eyed; Sterling Edges Up Before BoE

© Reuters.  © Reuters.

Investing.com – The dollar was holding steady against a currency basket on Thursday as investors continued to watch developments in Sino-U.S. trade negotiations, while the British pound edged higher ahead of the Bank of England’s latest policy meeting.

The against a basket of six major currencies was steady at 97.74 by 03:13 AM ET (08:13 GMT).

Washington and Beijing must simultaneously cancel some existing tariffs on each other’s goods for both sides to reach a “phase one” trade deal, the Chinese commerce ministry said on Thursday. China indicated it was ready to negotiate how much tariffs should be canceled.

The comments came after reports on Wednesday that a meeting between U.S. President Donald Trump and Chinese President Xi Jinping to sign an interim trade deal could be delayed until December.

“The dollar is looking for direction,” said Takuya Kanda, general manager of the research department at Gaitame.com Research Institute in Tokyo.

“The main catalyst for dollar buying was expectations that a U.S.-China trade deal is signed this month. If that is delayed by one month, that is not such a disappointment, but we need to see what the Chinese government has to say.”

The two sides have imposed tariffs on each other’s goods in a 16-month long trade war that rippled across financial markets, slowed global investments and growth. Negotiations have been fractious, making an agreement far from certain.

The dollar was little changed against the , at 108.93. The was a touch higher against the greenback at 1.1073.

German industrial output fell more than expected in September, data showed on Thursday, pointing to ongoing weakness in the sector and indicating that the Eurozone’s largest economy will slip into recession in the third quarter.

rose 0.14% to 1.2864 against the dollar, after briefly touching the lowest since Oct. 29. Against the , sterling was at 0.8604, trading in a narrow range before a BoE meeting later Thursday.

No change in policy is expected, but investors are focused on how the BoE will respond to uncertainties posed by Britain’s fraught exit from the European Union.

Traders are also awaiting results of a general election on Dec. 12, which will determine whether the ruling Conservative Party can capture a majority in Parliament and conclude Brexit by the Jan. 31 deadline.

The central bank’s updated forecasts are likely to show it is expected to go higher over the next two to three years, normally a sign that the BoE thinks rate rises will be needed.

–Reuters contributed to this report

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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Forex – Dollar Picks Up Ahead of Fed, Brexit Woes Weigh on Sterling

© Reuters.  © Reuters.

Investing.com – Demand for the dollar was underpinned on Tuesday amid growing expectations the U.S. Federal Reserve could take a wait-and-see approach to further easing, while the British pound slid lower as fresh uncertainty over Brexit weighed.

The , a gauge of the greenback against a basket of six major currencies was up 0.17% at 97.68 by 05:12 AM ET (09:12 GMT), the highest since Oct. 17.

The U.S. central bank is expected to cut rates for a third time in a row when it concludes its two-day meeting on Wednesday.

Investors are watching for any indication that further cuts are likely, with suggesting more easing is expected in 2020. If that is not foreshadowed, traders expect the dollar to rise.

“The forward guidance will be the thing,” said Westpac analyst Imre Speizer in Auckland.

“It still looks like a done deal that they will cut, but then the risk is that they might characterize that as just one more insurance move … the market will have to take out the pricing it’s got for future dates.”

slid to 1.2807 against the dollar, with Brexit hanging in the balance.

The European Union has agreed to delay Britain’s exit for up to three months, but the country is politically paralysed and overnight parliament rejected Prime Minister Boris Johnson’s third attempt to schedule a Dec. 12 election.

Johnson is seeking an election in an attempt to break the deadlock in parliament and push through his Brexit deal.

The was softer against the dollar, down 0.17% to 1.1080.

Against the safe haven , the greenback was little changed at 108.91.

“Global risks remain but have shown signs of subsiding,” Philip Wee, FX strategist at Singapore’s DBS Bank said in a note.

“China-U.S. trade tensions have stopped escalating … the Fed has reasons to sound less dovish on a ‘half-full’ narrative for the U.S. economy.”

U.S. President Donald Trump had said a trade agreement looked to be ahead of schedule on Monday, without detailing the timing. The United States also said it was studying whether to extend tariff suspensions due to expire in December.

–Reuters contributed to this report

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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