Dollar Plunges Further As Euro and Pound Rise on Brexit Headway

Dollar Plunges Further As Euro and Pound Rise on Brexit Headway

The dollar is trading generally softly today amid strong risky markets. But overall, most major pairs and crosses are limited to last week’s range.

Optimism pushed the dollar down during the first half of the day. Hopes were on the US stimulus package and the post-Brexit trade deal. The dollar rallied temporarily following a decision by the US Federal Reserve, as US policymakers took a wait and see attitude and then resumed their decline as the central bank is clearly showing dove in the long run.

US retail sales fell -1.1% mom to $ 546.5bn. In November, below expectations -0.2% mom. Sales excluding autos fell 0.9% mom, which below expectations of 0.2% mom growth. Sales excluding gasoline fell -0.9% mom. Sales excluding cars and gasoline fell 0.8% mom.

The U.S. Dollar Index (Futures) has experienced one of its worst years since 2017, despite an impressive rally to a 3 and a half year high of 103.79 in March. The U.S. Dollar Index (Futures) has experienced one of its worst years since 2017, despite an impressive rally to a 3 and a half year high of 103.79 in March.
Euro and Pound Rise on Brexit Headway
Sterling and the euro are generally growing today and maintain growth at the beginning of the American session. Progress in Brexit trade negotiations and stronger-than-expected PMIs lift both currencies, as well as their respective stock markets. The Canadian dollar is currently performing the worst, which, most likely, reacted to the stinging remarks of the Bank of Canada. Risk markets keep the dollar under pressure.

Concerning Brexit, reports have shown progress has been made, but no breakthrough has yet occurred, according to German Chancellor Angela Merkel. An EU spokesman said fisheries remain a major obstacle, as reported in the news.

Also, several headlines indicated that the UK had adopted the idea of ​​“managed divergence” to gain access to the single market. This means that if UK standards do not match EU standards, the Union has the right to retaliate. A Brexit trade agreement and US stimulus talks must be agreed upon before markets take a firm short-term direction.

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Author : Azeez Mustapha

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Azeez Mustapha is an experienced author, trader, markets analyst, signals strategist, and funds-manager.