16Jul
sgx

Forex Market Update

INTERNATIONAL CURRENCY BUZZ

Forex – Dollar Retreats From 2-Week Highs as GBP/USD Rebounds
Forex – GBP: Strong UK Data may Boost GBP, However, Brexit Overhang Remains
Forex – EUR/USD recovers from 1-week low and erases daily losses

EUR/USD

The EUR/USD pair recovered ground after the beginning of the American session rising from 1.1612, 1-week low, to 1.1670, slightly below daily highs. The pair remained above 1.1650 after the release of the Federal Reserve monetary policy report that Powell will present next week to Congress. According to the document, prospective economic conditions call for further gradual removal of monetary policy accommodation. The report had no significant impact on the US dollar as it added no new information. Despite recovering against the US dollar, the euro turned lower versus the pound. The slide of EUR/GBP could have limited the upside in EUR/USD. On a weekly
basis, the pair is about to post the first slide after rising during the previous there weeks. Overall, it continues to move within the 1.1800 – 1.1500 wide range. EUR/USD rose back above the 20-day moving average that stands at 1.1650 and is again a support level to consider.

GBP/USD

The dollar retreated from a two-week high against its rivals Friday, pressured by a rebound in the pound from an 11-day low. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell by 0.01% to 94.56, after hitting a two-week high of 95.00. GBP/USD rebounded from an 11-day low of $1.3103 to $1.3213, after U.S. President Donald Trump walked back his criticism of British Prime Minister Theresa May, and claimed a U.K.-U.S. trade deal was still possible. That eased investor fears that Britain would struggle to secure a trade deal with the United States as Trump had reportedly told the Sun newspaper on Thursday that May’s Brexit plan may “kill” Britain’s chances of such a deal. Elsewhere, China’s trade surplus with the U.S. hit a record of nearly $29 billion, raising the risk of deepening its trade-related rift with the United States.

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