Our Weekly Forex Recap will give you some of the market highlights from the past week, keeping you up to date with events and currency movements that move the needle in the forex industry.
Brexit talks: With the clock ticking down until the UK is due to leave the EU on March 29, there is still no agreement in London on how or even whether the country should leave the world’s biggest trading bloc, and a dramatic ‘no-deal’ exit with no provisions to soften the economic shock seems even more and more possible.
The US dollar retained a near three-week high on Tuesday as investors sought the relative safety of the greenback after the International Monetary Fund shaved its predictions for the world economy in 2019 and 2020.
The Bank of Japan shaved its inflation predictions on Wednesday and made a point about rising risks to the economy from stumbling global demand, further hampering policymakers’ years-long efforts to encourage durable growth.
China’s yuan rebounded against the U.S. dollar on Wednesday, improving all of its losses in the previous session, as companies took profits after its dip earlier this week.
The European Central Bank was uncertain as to whether it should keep policy unchanged on Thursday but may accept a sharp slowdown in economic growth, increasing the prospect of any further policy normalization being delayed.
The euro dropped on Thursday in the light of a European Central Bank meeting in which policymakers are expected to express caution about declining economic growth; the ECB is expected to restore its plan to raise.
On Friday, European shares hit their highest level in nearly two months, as investors swarmed to technology stocks after positive U.S. earnings overnight, while news of decreasing revenue growth from Vodafone weighed on telecoms.
The pound held near an 11-week high on Friday after a newspaper reported the party that props up the minority Conservative government could support May’s Brexit deal, on certain conditions, in a preliminary vote next week. The House of Commons will vote on alternative Brexit plans next Tuesday, after initially rejecting the deal May negotiated with the European Union, an occurrence that pushed the bloc to brace for a no-deal Brexit in two months.
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