Home » Market News » Dollar Loses Steam and Brexit comes back into Focus

Dollar Loses Steam and Brexit comes back into Focus

dollar, treasury

The dollar is trading near a better than two month low against the Japanese yen during the Asian trade session. The dollar is running out of steam as trade related optimism is fading.

Forex traders are looking for safe haven assets after news that a smooth Brexit is still a remote possibility.

Looking at the headline USD/JPY currency exchange rate, the dollar is trading at 108.35 yen. This is close to a two and half month low price point, set at the end of last week, at 108.63 yen.

The headline EUR/USD Forex market saw the euro trading steady at $1.1025 against the dollar. On Friday, this Forex market hit a three week high at $1.1062.

The British pound has fallen back from a three month high price point set at the end of last week. Traders are worried that a Brexit deal is still a ways off and that the United Kingdom could still crash out of the Eurozone.

The GBP/USD Forex market was trading at 1.2605 during the Asian session.

The Dollar Falls as Forex Traders Doubt the Trade Deal and Monitor Brexit News

The financial markets originally welcomed news of the completion of a “Phase One “of a trade deal between China and the United States. However, lack of details are unnerving traders as they have been down this road in the past.

China wants more talks as soon as the end of the month. They want to hammer out the details of the so-called Phase One deal and before China’s President, Xi Jinping agrees to sign the deal.

Traders are also monitoring the Brexit talks as a deal remains elusive.

The European Union wants more concessions from Prime Minister Boris Johnson. European diplomats say that a deal by the end of the week is unlikely. PM Johnson wants a deal at the European Union Summit on Thursday or Friday.

This would allow the United Kingdom to exit the European Union on October 31 in an orderly manner. Johnson says that that the UK will exit no matter what with or without a deal despite a new British law saying he must have a deal in place.

About David Frank

David has his MA and PhD in Economics. He is a technical analyst who has been trading in the Forex world for over a decade. As an analyst and trader, David believes in the big picture by blending together technical analysis with the fundamentals behind the scenes in the Forex and Bond markets. David’s trading strategy is unique. He blends an understanding of fundamental and macroeconomics with technical analysis to offer a unique view into Forex. He applies several strategies including carry long positions, to take advantage of high yields in non-volatile markets, as well as using quicker, chart related analysis for day trading.

Check Also

euro

Euro Currency falls below 1.2080 to Challenge 1.2070

0.0 00 Looking at the benchmark EUR/USD currency exchange rate, the euro currency has fallen …