Our website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.

Sterling dented by one-two punch from dollar and euro

by Jessica Weisman-Pitts
0 comment

Sterling dented by one-two punch from dollar and euro

LONDON (Reuters) – The pound neared its lowest in almost two months against a robust dollar on Tuesday, as the U.S. currency got a lift from a pop higher in Treasury yields, while the euro extended its modest rally over the last week.

Investors in U.S. assets are contemplating the prospects of a second Donald Trump presidency, after President Joe Biden’s faltering debate performance last week and Monday’s Supreme Court ruling that the former president has broad immunity from prosecution over attempts to overturn his 2020 election loss, said Chris Weston, head of research at Pepperstone.

With the dollar broadly in the ascendant, sterling traded around 0.25% down on the day at $1.2618, skimming last week’s low at $1.2616, its weakest since May 15. Against the euro meanwhile, the pound held steady at 84.935 pence, but is hovering around its lowest since early June.

European Central Bank President Christine Lagarde on Monday said the central bank was in no rush to cut interest rates, which gave the euro a boost against the pound the day before, but did little to lift the single European currency on Tuesday.

“Funnily enough, the biggest casualty of Lagarde’s comments and the French election has been the pound, whose decline in value against the euro has sent the overall pound index to its lowest level for five weeks,” Caxton strategist David Stritch said.

A first round of voting in French elections at the weekend resulted in the far-right National Rally (RN) taking the largest share of the vote, but less than many had initially anticipated, which has supported the euro.

Markets are currently pricing in the prospect of at least one more ECB rate cut this year, but the chance of a second have faded slightly.

Meanwhile, Britain heads to the polls on Thursday. The opposition Labour party is widely expected to win, ending 14 years of Conservative government. The UK’s tight finances mean any new government will have little room to up spending, potentially removing a catalyst of sterling weakness and keeping volatility contained.

 

(Reporting by Amanda Cooper; Editing by Anil D’Silva)