The dollar is strong heading into Fed meeting; U.K. Supreme Court hears landmark Brexit case
Kathryn Garvey | September 17, 2019
September 17, 2019
EUR/USD 1.1023 GBP/USD 1.2427 USD/CAD 1.3273 AUD/USD 0.6835 USD/JPY 108.22 USD/CNH 7.0943 USD/ILS 3.5560 USD/MXN 19.5369 USD/CHF 0.9966 USD/INR 71.7875
USDThe dollar extends yesterday’s gains as demand for the currency increased ahead of the week’s monetary policy decisions. The Fed begins its 2-day meeting today during which a 25bp cut is expected. The US commitment to deploy oil reserves lowered crude oil prices as Saudi Arabia begins to figure out how to replenish production capacity.GBPThe pound seeks to recover some of Monday’s losses and is in search of direction driven by Brexit news. A hearing in the UK’s Supreme Court begins today on Boris Johnson’s decision to suspend Parliament. The case threatens to undermine the power of the prime minister and could also force him to recall the suspension decision – which would give those opposing a no-deal Brexit more time to pass laws blocking a no-deal departure come October 31.EURThe euro is slightly higher after dropping 0.64% yesterday. ECB Chief Economist, Philip Lane said in a speech yesterday that a split in opinion in the central bank is okay after the divergence of views from ECB leaders during last week’s meeting.CADThe loonie dropped this morning driven mostly by weaker-than-expected Manufacturing Sales data for July. Sales declined 1.3% in July versus -0.2% expected. A cool-off in oil prices after Monday’s historic surge also drove the Canadian dollar lower.ASIA/PACIFICPresident Trump has notified lawmakers he has reached an initial agreement on reciprocal tariff reductions with Japan. The yen weakened slightly on the news. The Bank of Japan is set to meet on Thursday in a regularly scheduled meeting.
China’s renminbi weakened overnight after the central bank kept one-year rates on medium term loans steady on Tuesday indicating the central bank prefers not to provide too much liquidity to the markets.
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