Pound bounced on Thursday on reports that London is close to sealing a financial services deal with Brussels. Further, the Bank of England signaled slightly faster future interest rate rises if Brexit goes smoothly.
The dollar soars as it climbed to its highest levels since June 2017 on Wednesday. Dovish comments by the BoJ and its decision to keep the monetary policy steady and weak Eurozone growth figures weighed. Further, weak data from China strengthened the greenback and attracted Forex traders.
The U.S. President Donald Trump said he thinks there will be “a great deal” with China on trade. Otherwise he warned new tariffs if a deal fails, opening a new chapter in the US-Sino trade war.
The British pound dropped near 7-week lows against the dollar on Friday and three-week lows versus the euro. Concerns grows about whether the UK and the European Union can achieve a Brexit deal.
The euro is steady on Thursday after a 2-month low in its previous session. The ECB decided to keep policy unchanged and end bond purchases by the end of the year. Traders’ eyes are now on ECB President Mario Draghi’s press conference.