Dollar Down Pound Up Over Brexit

FxPremiere.com – Forex Signals | The dollar was down on Thursday morning in Asia, with investors retreating from the safe-haven greenback and turning to the pound over expectations of an imminent Brexit deal that could help the U.K. avoid a turbulent economic rupture come Jan. 1.

The U.S. Dollar Index that tracks the greenback against a basket of other currencies inched down 0.09% to 90.168 by 8:59 PM ET (1:59 AM GMT).

The index has lost more than 6% during 2020 over investor bets that the U.S. Federal Reserve will maintain an accommodative monetary policy and expectations of more fiscal stimulus in 2021 to aid economic recovery from COVID-19.

Some investors forecast that an expected further decline in the greenback will boost stock markets and emerging-market currencies.

“The fact that equity indices traded mostly in the green this morning reflects a consensus expectation that Trump will sign the budget into law, although he could wait until the eleventh hour,” Rabobank senior FX strategist Jane Foley said in a note.

“If this doesn’t happen the dollar could benefit from safe haven buying,” but longer term the dollar will weaken to $1.23 per euro over the course of next year, the note added.

The USD/JPY pair inched up 0.02% to 103.57.

The AUD/USD pair edged up 0.20% to 0.7587, while the NZD/USD pair inched down 0.01% to 0.7094.

The USD/CNY pair inched down 0.06% to 6.5360.

The GBP/USD pair gained 0.36% to 1.3540. The euro also strengthened 0.1% to $1.22025, adding to its 0.2% gain overnight.

Pound Higher on Brexit Deal

A Brexit agreement will protect some $1 trillion in annual cross-channel trade between the U.K. and the European Union (EU) from tariffs and quotas.

FX Signals | Dollars bought as stimulus hopes

However, the note was cautious about the pound’s prospects even if a deal does transpire.

Dollar Down Over Brexit, U.S. Stimulus Risks

Forex for Beginners

Brexit expectations helped to overshadow U.S. President Donald Trump’s demands to a COVID-19 aid bill, which he termed “a disgrace”, that was passed by both the House of Representatives and the Senate earlier in the week.

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The bill needs to be signed by Trump in order to become law, and his reticence threatens a government shutdown after the Christmas holidays.

Sterling gains dollar on back foot

Dollar Down Pound Up Over Brexit

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Dollar Down Pound Up Over Brexit

Dollar Down Pound Up Over Brexit