The dollar has almost reached a 17-month high against a basket of major currencies, investors need a liquid and high-yielding currency amid unrest about the global economic growth and political risks in Italy and the UK.
Even a 2 percent jump in oil prices, which initially supported European markets, could not remedy the situation. In addition, investors are concerned about signs of slowing growth in China, and many believe that the actions of US President Donald Trump will further harm the economy of the Middle Kingdom. All of this, combined with political risk in Europe, pushed the dollar. As a result, the sterling lost more than 1 percent, and the euro, 0.7 percent, reaching the lowest level since July 2017.
As expected, the dollar made a loud return, which was also facilitated by the decision of the Fed to adhere to plans to tighten monetary policy. The euro and the pound are increasingly lagging behind the US currency under pressure from political risks. The prospects for the pound are even worse, especially considering the upcoming problems in parliament.
There is no good news for the euro either. Italy remains the main focus. In the third largest economy in the eurozone, the ghosts of the banking crisis are already noticeable, with Italian banks falling 0.6 percent. And, probably, the euro will fall below $ 1.10 from the current $ 1.126. All this is good news for dollar bulls.
The material has been provided by InstaForex Company -
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