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Forex Today: Pound falls on election uncertainty; markets generally steady amid relatively thin economic docket

Here is what you need to know on Friday, October 25:
 

  • The US Dollar ignored weaker US durable goods orders report and gained some traction in the wake of positive news regarding the US-China trade deal. Reports suggested that China aims to buy at least $20 billion of American farm products as a part of the phase one deal in the first year. This would bring purchases back to 2017 levels, or before the US-China trade war began.
  • The European Central Bank (ECB) meeting on Thursday turned out to be a non-event for the market, though the outgoing ECB President Mario Draghi's gloomy outlook for the Euro-zone economy exerted some downward pressure on the shared currency. Draghi's eight-year term ends on October 31 and he will be succeeded by the former IMF head, Christine Lagarde.
  • The British Pound witnessed some aggressive selling on Thursday after the UK Prime Minister Boris Johnson said that the lawmakers should back an early snap general election on December 12 to get more time to study his Brexit deal with the European Union.
  • Meanwhile, the European Union has reportedly delayed a decision on whether to grant a three-month Brexit extension and will wait until Monday, or possibly Tuesday, before announcing the final verdict. This added a bit of uncertainty and kept the GBP bulls on the defensive, albeit diminishing odds of a no-deal Brexit might help limit deeper losses.
  • Apart from a fresh bout of Brexit anxiety, growing concerns about slowing global growth weighed on investors' sentiment and lifted the safe-haven Gold to over two-week tops, levels further beyond the key $1500 psychological mark. Conversely, the Japanese Yen failed to attract any safe-haven demand and remained confined well within this week's trading range, just above mid-108.00s pivotal point.
  • Cryptocurrencies edged higher during the Asian session on Friday but seemed struggling to gain any strong follow-through traction.

Author

Haresh Menghani

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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