020 7898 0500With no major data announcements from the US yesterday, the dollar managed to claw back some of its recent losses as tensions eased between North Korea and the United States. Kathy Lien, the managing director of BK Asset Management, suggested a rise in geopolitical tensions could lead to a 3-5% fall in the dollar. Interestingly, Lien alluded to the Libyan Civil War in 2011, where we saw a 5% drop in the dollar and almost 9% in the run up to the second Gulf War in 2003.
Unlike yesterday, we have a busy day ahead for economic data. Retail sales for July are due and also housing information. Retail sales are forecast to edge 0.3% higher in July and, if this is the case, it could bring the interest rate debate back to the fore, causing further uncertainty in the market.
