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Dollar drops further in forex markets as pound rises

GBP and USD on keyboardThe US dollar continued its run of bad performance on Monday after data releases spelt trouble for the American economy.

Manufacturing output in the country went down by almost half a percentage point, for example. Region-specific data also showed poor performance.

The dollar will also have to contend with the Federal Reserve’s meeting later this week. With uncertainty over whether rate rises or cuts are on the horizon later this year, traders appear to be backing away from the currency.

The dollar index, which tracks how the greenback is performing compared to several other major currencies from around the world, went down 0.1% to 96.481.

This followed a drop of just over 0.8% last week and represents the largest plummet for the currency since August of 2018.

The British pound, meanwhile, was enjoying success in the markets.

Following last week’s news that the House of Commons was against Britain leaving the EU without a deal, the currency has been performing strongly.

As trading began, it remained close to the high $1.3380 figure in the GBP/USD pair which it saw last week.

As a new week gets underway in the forex trading markets, there’s plenty to be looking out for.

This afternoon (Monday) there will be a housing market index release from the National Association of Home Builders covering the month of March. This is expected to show a rise from 62 to 63.

Later in the day, there will be a speech from the Reserve Bank of Australia’s Christopher Kent, who is the Assistant Governor (Economic).

Into tomorrow, British unemployment figures for January will be released at 9.30am GMT. It is expected that this particular measure will remain steady at 4%.

The German Zentrum für Europäische Wirtschaftsforschung will publish its economic sentiment survey covering March at 10am GMT. This is expected to show a change from -13.4 to -11.3.

At the end of the day, there will be a monetary policy meeting minutes release from the Bank of Japan. This is expected at 11.50pm GMT.

At midnight on Wednesday, there will be a speech from the Reserve Bank of Australia’s Michele Bullock, who is the Assistant Governor (Financial System).

The British consumer price index for February will be released at 9.30am GMT. This is expected to show no year on year change and remain firm at 1.8%.

The Federal Reserve in the US will make its interest rate decision at 6pm GMT. This is expected to remain steady at 2.5%.

Gross domestic product information is expected from New Zealand covering the last quarter of 2018 at 9.45pm GMT and is due to show a quarter on quarter change from 0.3% to 0.6%.

Japanese banks will be closed on Thursday due to the Vernal Equinox Day holiday. Other economies, however, will remain active.

Australian employment change data for February will be out at 12.30am GMT and is expected to show a change from 39,100 to 15,000.

The Bank of England will make its interest rate decision at 12pm GMT. This is expected to remain firm, at 0.75%.

Risk Statement: Trading Foreign Exchange on margin carries a high level of risk and may not be suitable for all investors. The possibility exists that you could lose more than your initial deposit. The high degree of leverage can work against you as well as for you.


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