Forex - Pound Slips as Johnson Calls for Election; Dollar Moves Higher on PMI Data
Investing.com
Published Oct 25, 2019 12:10AM ET
Investing.com - The British pound slipped against the U.S. dollar on Friday in Asia after U.K. Prime Minister Boris Johnson said U.K. lawmakers should back an early Dec. 12 general election to get more time to scrutinize the Brexit deal, creating more uncertainties surrounding the country’s departure process.
The GBP/USD pair slipped 0.1% to 1.2842 by 12:05 AM ET (04:05 GMT).
EU officials will meet later in the day to decide how long they will extend Britain’s deadline for departing from the bloc.
Meanwhile, the U.S. Dollar Index that tracks the greenback against a basket of other currencies inched up 0.1% to 97.470.
The greenback was boosted after the Markit purchasing managers’ index came in higher than expected, at 51.5 compared to 51.1 in the prior month.
The data raised expectations that the Federal Reserve will cut borrowing costs for a third time this year even further.
The central bank’s policymakers will meet next week. U.S. President Donald Trump has pushed for even more rate cuts, pointing to falling interest rates at other central banks around the world.
“The Federal Reserve is derelict in its duties if it doesn’t lower the Rate and even, ideally, stimulate. Take a look around the World at our competitors. Germany and others are actually GETTING PAID to borrow money. Fed was way too fast to raise, and way too slow to cut!” the president tweeted.
The EUR/USD pair was unchanged at 1.1102 after the European Central Bank (ECB) left monetary policy unchanged on Thursday.
Outgoing ECB President Mario Draghi rejected criticism of his negative interest rate policy and his insistence on resuming outright purchases of government bonds from next month.
“The improvements in the economy have more than offset the negative side effects” on the financial system, Draghi said at his regular press conference.
He added that he wasn’t unduly concerned about the dissent regarding September’s multi-faceted package of easing measures, saying that all the key economic data from the euro zone in the course of the last month had justified the actions.
“I’ve taken this as part and parcel of the ongoing debate and discussions,” Draghi said.
The USD/JPY pair traded 0.04% higher at 108.64.
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Written By: Investing.com
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