The U.S. dollar was on track to break a four-day losing streak on Thursday, climbing higher against its rivals amid renewed uncertainty over Sino-American trade negotiations and weakness in European currencies. The British pound retraced its gains from a day ago as traders await further developments on Brexit.
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The ICE U.S. Dollar Index
a measure of the currency against six major rivals, climbed 0.2% to 96.728 on Thursday, aiming for its first gain in five sessions. The euro
slipped 0.2% to $1.1303.
The British pound
pulled back from the nine-month high it touched after the U.K. Parliament ruled out a no-deal Brexit on Wednesday. Sterling also recorded its biggest one-day move in nearly two-years on Wednesday, according to Dow Jones Market Data. The pound last bought $1.3278, down from $1.3337. Against the euro
sterling also slipped, with one euro last buying £0.8514, up 0.2%.
“In terms of its cumulative return week-to-date, the pound has traded like there is a clear way forward to the removal of ‘cliff-edge’ risk, a ‘soft Brexit’ or no Brexit. We’re not confident there is a clear way forward to anything,” wrote Stephen Gallo, European head of FX strategy at BMO.
Parliament’s rejection of a no-deal outcome was part of three key votes on the U.K.’s exit from the European Union this week. On Tuesday, Parliament rejected Prime Minister Theresa May’s Brexit deal, while on Thursday, lawmakers will vote on whether to extend the Brexit deadline until after March 29.
Market participants expect an extension. So far all votes have been in line with expectations.
President Donald Trump, meanwhile, tweeted that the U.S. was looking forward to negotiating a trade deal with the U.K.
My Administration looks forward to negotiating a large scale Trade Deal with the United Kingdom. The potential is unlimited!
— Donald J. Trump (@realDonaldTrump) March 14, 2019
During a meeting with Irish Prime Minister Leo Varadkar, Trump also said he was surprised at how badly the Brexit negotiations had gone but that holding a second referendum would be unfair.
Elsewhere on the trade front, a meeting between Trump and Chinese President Xi Jinping has been delayed to at least April, according to a Bloomberg report. The two heads of state were initially expected to meet in March, though a date had not been set.
China’s yuan weakened against the dollar amid mixed economic data that also weighed on Chinese stocks
One dollar last bought 6.7229 yuan
in Beijing, up 0.2%, and 6.7230 yuan
in the offshore market, up 0.3%
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