020 7898 0500The dollar continued to weaken yesterday, with the Dollar Index hitting its lowest point since October 2016. This is largely due to rate hike signals coming from some of the world’s key central banks. Furthermore, a combination of political uncertainty in the US and optimism surrounding the Eurozone’s economy resulted in EUR/USD hitting the 1.14 level.
The dollar slid against the pound for the seventh consecutive day, following comments from Mark Carney that were judged to indicate a UK interest rate hike in the future. While it wasn’t an explicit endorsement for tighter monetary policy, what Carney said opened up the possibility and the markets reacted in the way they saw fit.
Yesterday we saw improved final GDP figures from the US at 1.4% against a forecast of 1.2%. This was a result of unexpectedly high consumer spending and a bigger rise in exports than was anticipated.
Today is a quiet day for US economic data, but it will be interesting to see whether the dollar can recover some its losses against the pound.
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