Eyes on the American Index, Brexit Proceeds
As the Federal Reserve Bank gets ready to meet this week, the American Dollar Index changed to $97.49 from yesterday’s $97.80. In Europe, investors look forward to a Brexit deal.
US President, Trump, expects to cut rates for the third time in a row this year.
The CNY/USD pair fell 0.09% at ¥0.1416 fell when the UN urged China to stop detaining ethnic Uighurs and other Muslims. China’s UN Ambassador Zhang Jun said the criticism only disrupted their improving relationship, especially during their trade talks.
Zhang Jun expanded on the statement, saying the US is using other Chinese issues to “blame the others.”
Meanwhile, the dollar inched up against its sterling opposite with 0.02% at £0.7772. Investors await the Brexit talks’ outcome until the “flextension” on January 31, 2020.
UK lawmakers voted 438 to 20 to hold a general election this December.
The Labor Party recently blocked the UK Parliament’s attempt for a Brexit deal. If the Conservative Party opposition performs well, investors expect a relatively soft Brexit.
The EUR/GBP pair kept almost flat, with a 0.01% decrease at £0.8632.
The pound is under pressure for Brexit’s uncertainty in the next coming months.
What to Expect from the Fed Bank Meeting
Unemployment rates reached a 50-year low that suggested that further rate decreases are not necessary. However, reports show the American economy is weakening.
Analysts expect the Fed bank to make short-term measures for funding markets. These “repo” markets showed signs of strain in September before the Fed interfered with open market operations.
Other economists say the bank will insist on acting as “appropriate” to support the expansion. Goldman Sachs claim they would erase the phrase from their statement
Americans spent less on retailers and restaurants last month. Businesses reduced their spending on industrial machinery from reluctance for big purchases.
The government will issue its first estimate of the American economy for this quarter.
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