Dollar Stuck in Doldrums

While news of the chaos in the British economy relative to the uncertainty of the Brexit have taken over the headlines, the Pound's impact on other currencies, as a result, cannot be understated. The slide in the Pound had earlier helped to push the US Dollar Index away from a 2½ week trough but it could not maintain the momentum. The greenback has been weighed heavily by growing speculation that the US central bank is planning to take a breather from its hawkish cycle, perhaps sooner than initially anticipated. Analysts confirm that the declining yields on US Treasuries is likely to also keep the Dollar in the doldrums, and the disappointment in the most recent economic data has provided no respite.

As reported at 11:40 am (GMT) in London, the EUR/USD was trading at $1.1398, a gain of 0.40% and just off the session peak; the pair has ranged from a session high of $1.13989 to a low of $1.13508. The USD/JPY was trading at 113.0790 Yen, down 0.1625%; the pair is moving off the earlier high of 113.340 Yen. The AUD/USD was trading at $0.7212, up 0.30% while the NZD/USD was trading at $0.6879, up 0.15%.

Back in the UK, the Pound is getting a lift from some better than expected labor data. The Office of National Statistics reported that average earnings excluding bonus had improved to 3.3% for the 3-month period ended October, up from the 3.2% flat reading which had been predicted. The average earnings including bonus was also higher at 3.3%, well above the 3.0% which had been expected; the previous reading was adjusted higher to 3.1% from 3.0%. That news helped the Pound; the GBP/USD was trading higher at $1.262, up 0.46%.

Barbara Zigah

After working on Wall Street, Barb began her second career as a freelance writer at Daily Forex, where the CEO recognized fresh, untapped potential and was willing to give her a try. She’s never looked back. Since then, she’s worked steadily as a freelance writer and editor in the financial services and Forex-related industry.