Quantcast
Connect with us

Dollar stalls, sterling steadies after May wins no-confidence vote

Published

on

The dollar took a breather on Thursday following its recent strong gains against key rivals, while sterling steadied after British Prime Minister Theresa May’s government won a no-confidence vote in parliament.

The dollar index .DXY, which measures the greenback against six major peers, was a shade higher at 96.133 after gaining about 1 percent over the previous five sessions.

On Jan. 10, the dollar almost fell below its 200-day moving average as the index touched a three-month low of 95.029. But then it bounced up, and stayed above that average.

The U.S. currency held onto its gains against the euro EUR= as persistent worries about the euro zone economy weighed on the single currency.

Data this week showed Germany barely avoided slipping into recession in 2018’s second half, and European Central Bank chief Mario Draghi warned on Tuesday that economic developments in the euro zone have been weaker than expected.

The dollar was trading basically flat against the euro at $1.1388 after rising five straight sessions against the single currency, during which it gained about 1.5 percent.

ADVERTISEMENT

Catching investors’ attention was a report in the Wall Street Journal that U.S. federal prosecutors were investigating Huawei Technologies [HWT.UL], for allegedly stealing trade secrets from U.S. businesses and could soon issue an indictment.

Also in focus were concerns the U.S. government shutdown was starting to take a toll on its economy, while investors awaited more cues from the Federal Reserve after a growing number of its officials expressed caution about further rate hikes.

“There’s a lot of speculation that we’ve seen the end to the rate-hike cycle and many people are even talking about rate cuts this year,” said Bart Wakabayashi, Tokyo branch manager at State Street Bank.

“The immediate is going to be the messaging from the Fed plus of course their action,” he said. “If we’re assuming that the market is still long dollars, any sort of change in that is going to have a pretty lasting effect.”

ADVERTISEMENT

The U.S. central bank’s Federal Open Markets Committee will hold the next policy-setting meeting on Jan. 29-30.

Businesses across the United States have become less optimistic in recent months, the Fed said on Wednesday in a report on the economy that supports Chair Jerome Powell’s pivot to more “patience” on interest rate hikes.

The dollar edged lower to 109.00 yen JPY=.

The British pound was stable after May survived the no-confidence vote and invited other party leaders for talks to try to break the impasse on a Brexit withdrawal deal after the proposal she presented was voted down by lawmakers on Tuesday.

ADVERTISEMENT

An outline for May’s Plan ‘B’ is due by Monday and the market assumes there will have to be an extension of the Article 50 exit date past March 29.

“It’s unlikely there will be big changes to May’s plan, so parliament is likely to oppose it as well,” said Yukio Ishizuki, senior currency strategist at Daiwa Securities.

Sterling was last trading at 88.42 pence per euro EUROGBP=, hovering close to a seven-week high of 88.37 pence touched during the previous session.

Against the dollar GBP=D4, it was basically flat at $1.2872, close to a two-month high of $1.2930 hit at the start of the week.

ADVERTISEMENT

May said late on Wednesday the opposition Labour Party had yet to discuss a new approach to Brexit with her and urged politicians to put self-interest aside to work to break the impasse.

Wakabayashi of State Street Bank said that on the euro and sterling, “I don’t really see why you would responsibly be heavily positioned either way when you’ve this unknown Brexit.”

“I wouldn’t be overexposed either way when there’s such a large question mark,” he said.

Editing by Jacqueline Wong and Richard Borsuk

Report typos and corrections to [email protected].
READ COMMENTS - JOIN THE DISCUSSION
Continue Reading

Breaking Banner

Soccer superstar Megan Rapinoe profanely rips Trump and vows she won’t go to the White House

Published

on

U.S. women's national soccer team star Megan Rapinoe will not be visiting the White House if the team successfully repeats their Women's World Cup victory.

"I'm not going to the f*cking White House," she told Eight By Eight Magazine.

"We're not going to be invited," she added.

On Monday, President Donald Trump ripped Rapinoe for protested during the national anthem.

Continue Reading

Breaking Banner

Robert Mueller likely thought Don Jr. was guilty — here’s why that actually made it hard to investigate Trump

Published

on

Special counsel Robert Mueller has completed his investigation of ties between Russia and President Donald Trump's campaign, turned over his findings to Congress, and stepped down from his post at the Justice Department.

His findings were incredibly damning for the president and his allies, finding evidence that the campaign eagerly accepted Russian help, if not a full-blown conspiracy, and outlining ten potential episodes where Trump obstructed justice. But Mueller's conclusions are by no means the end-all of everything that happened. Mueller himself acknowledged in his report that Trump's lack of cooperation probably prevented him from finding a lot of information.

Continue Reading
 

Facebook

Palestinians ‘not willing to give up their misery’, Israeli historian says

Published

on

The Palestinian leadership should sign on to the US economic development plan and worry about their political status later, Hebrew University of Jerusalem Historian Gaudi Taub told FRANCE 24.

The Palestinian leadership should sign on to the US economic development plan and worry about their political status later, Hebrew University of Jerusalem Historian Gaudi Taub told FRANCE 24.

Palestinians are wrong to reject the $50 million US blueprint to rebuild the Palestinian economy, which US Presidential advisor and son-in-law Jared Kushner said is a precondition to peace in the region, Taub said.

Continue Reading
 
 

Copyright © 2019 Raw Story Media, Inc. PO Box 21050, Washington, D.C. 20009 | Masthead | Privacy Policy | For corrections or concerns, please email [email protected]

 ENOUGH IS ENOUGH 

Trump endorses killing journalists, like Washington Post columnist Jamal Khashoggi. Online ad networks are now targeting sites that cover acts of violence against dissidents, LGBTQ people and people of color.

Learn how you can help.
close-link