The dollar is strong today; Boris Johnson’s request to suspend parliament sinks the pound
Laurence Hayward " | August 28, 2019
The USD and the pound are having a good day at the expense of the minor currencies. The yuan weakening to above 7 is putting pressure on emerging market currencies. The pound took a dive this morning after PM Johnson asked the Queen to suspend parliament next month, thus increasing the odds of a potential no-deal Brexit.
August 28, 2019
EUR/USD 1.1079 GBP/USD 1.2206 USD/CAD 1.3300 AUD/USD 0.6745 USD/JPY 105.84 USD/CNH 7.1710 USD/ILS 3.5331 USD/MXN 20.0161 USD/CHF 0.9815 USD/INR 71.7700
The dollar strengthened today. Ex former Fed President William Dudley said the Central Bank should reconsider its apolitical approach. FOMC members Daly and Barkin are scheduled to speak today. The yield curve inverted yesterday with the 2 year higher than the 10 year. This is traditionally viewed as a pre-cursor to a recession.GBP
Boris Johnson has asked the Queen to suspend parliament to avoid a confrontation over a no deal Brexit. The opposition parties met to talk about trying to set up a legal barrier to a no-deal Brexit when parliament starts its new session next week. After strengthening to its strongest level since the beginning of August yesterday, the pound dipped on Boris Johnson’s comments.EUR
ECB Vice President de Guidos said the ECB should take market expectations “with a pinch of salt”. Saying the “ECB’s monetary policy is data dependent, not market dependent”. The euro is weaker.CAD
The Canadian dollar strengthened as WTI oil climbed after falling yesterday.ASIA/PACIFIC
China introduced a number of measures to try and increase consumer spending and called for exporters to move their focus to producing products they can sell in their domestic market. The yuan weakened. The confusion over trade talks with China continues after Trump comments.
Reserve Bank of Australia deputy Governor Guy Debelle said the weakening Aussie dollar was helping the economy and that further falls would be beneficial.