FX Market: Dollar Strengthens, Pound Weakens

FX MARKET – Last Tuesday in Europe, nearly on its third week, the dollar was close to being on its highest level on trading. At the same time, optimism has been damaged, raising the possibility of a disruptive and disorderly Brexit by the euro and sterling.

On Monday, the greenback against a basket of six major currencies was at 96.920, up some 0.2% from its closing levels, which was measured by the dollar index.

After lawmakers voted on withdrawing all the proposed alternatives to the government’s agreement, the pound dropped a cent but recovered a fraction to $1.3044 on Monday.

After multiple rounds of voting in over three weeks, for the first time, the euro plunged below $1.12 on Brexit fears that could kick the eurozone economy into recession.

Hard Brexit is Predicted

In a radio station, on Monday, Clemens Fuest, President of the Institute for Economic Research in Munich and a member of the German government’s council of economic advisers said that a hard Brexit “could be the straw that breaks the camel’s back” with advice on the German economy into recession.

This morning, the government of the United Kingdom arranged a meeting for a projected crisis, deciding to bring or quit the thrice-rejected Withdrawal Agreement for another set of voting on Wednesday. Another option is to ask for an extension on the European Union regarding the Brexit deadline.

Despite leaving the regular policy unchanged, an anticipated cut in the interest rates was hinted by the Reserve Bank of Australia that made the Aussie also plunge against the dollar overnight.

As approvals on buildings grew on their strongest rate in five years, China’s economy boosted in parallel with the Australia that decelerated abruptly.

Swinging wildly through a 4% range after the prior 24 hours in the wake of Sunday’s municipal election results in Istanbul, the Turkish lira was at 5.5728 against the dollar.

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