The Euro continued gaining on Friday, hitting a two-month high. It jumped up by 0.2% to $1.111, reaching its highest point since March 30. The common currency got a boost following the European Commission’s stimulus plan issued earlier this week. After the 750 billion-euro coronavirus recovery fund fuelled optimism about the eurozone economy, the Euro headed for its second weekly gain.
However, the British pound declined against the Euro. It recovered slightly later, rising by 0.3% at 90.145 pence. On the other hand, the Sterling was steady against the dollar. It lowered by 0.04% to $1.2312, but still managed to stay on course for its second weekly gain.
The pound has suffered due to calls for the resignation of one of the aides to British Prime Minister Boris Johnson, as well as speculation about negative interest rates and lack of progress in EU trade talks.
-
-
- Interested in trading the British pound? Read WiBestBroker’s comprehensive review on FXChoice.
-
What about the U.S. dollar and the Chinese Yuan?
The investors were looking out for U.S. President Donald Trump’s response to China’s restricting control over Hong Kong. The situation is under control so far, but they fear that it could become volatile fast.
However, uncertainty in the markets increased the demand for safe-haven currencies. The Japanese yen soared against major currencies as investors awaited Trump’s response to China’s passing of a national security law for Hong Kong. The U.S. dollar tumbled down by 0.4% against the Japanese currency, at 107.17 yen.
Moh Siong Sim, a currency strategist at Bank of Singapore, thinks that the market is still fearful that things may escalate into something more serious. Sim noted that, if Trump were serious with trade tariffs, they would have a meaningful impact. He also added you could never quite predict Trump. However, this year, it seems really difficult for him to act directly, referring to the dire state of the U.S. economy.
The Chinese yuan was little changed in the Offshore market. It traded at 7.1661 per dollar, near to the nine-month low of 7.1965 yuan per dollar reached on Wednesday.
COMMENTS