The greenback surged to new highs against a basket of foreign currencies, causing the U.S. dollar/Japanese yen (USD/JPY) currency pair to push above 112, EUR/USD tumbled below 1.0550 and dollar-denominated gold took an absolute hammering as it skidded below $1,200 to drop to a low so far of about $1,881.
Today, UK Chancellor Philip Hammond will deliver the first budget under Theresa May’s government. It could contain a lot of surprises. I think that because of Brexit, Hammond will unleash a spending spree to help support the economy. This could very well support the pound, which is lower across the board at the time of this writing.
It may be a quiet day in terms of economic data, but there’s been plenty of political news in mainland Europe which has affected both the euro and stocks. The big news is that Angela Merkel would be running for her fourth-term as German chancellor, while in France the centre-right Republican Party is close to choosing its presidential candidate after former leader Nicolas Sarkozy was knocked out of the race.
As the week draws to a close, the Euro/U.S. dollar (EUR/USD) currency pair is still limping, now below 1.06. It could absolutely collapse next week as the dollar appreciates further. The market seems convinced that the Fed will hike interest rates in December and tighten its belt further in 2017.
Global stocks staged an awe-inspiring rebound during late trading on Wednesday as investors came to terms with the shocking Donald Trump presidential victory. Asian shares rallied in the early sessions of Thursday with the Nikkei lurching close to 7% as participants re-evaluated the global effects of Trump’s severely mispriced election win.
The USD is lower across the board versus major currencies as the U.S. election enters its final stretch. The FBI investigation into Secretary Hillary Clinton's e-mails has eroded her lead in the polls and the battle for swing states will be crucial. The eyes of the world will be watching as votes start coming in on Nov. 8.
The Euro/U.S. dollar (EUR/USD) currency has rallied sharply this week, thanks mainly to a slump in U.S. dollar as opinion polls narrowed and uncertainty about the U.S. elections grew after the FBI announced at the end of last week that it will launch an investigation into Hillary Clinton’s e-mails.