Home NewsForex Market News (New York) The tax cut bill frightened the pound, DXY, rose nearly 3% in the week, the best in more than 2 years | Anue Juheng

(New York) The tax cut bill frightened the pound, DXY, rose nearly 3% in the week, the best in more than 2 years | Anue Juheng

by WOOWinvest
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(New York) The tax cut bill frightened the pound, DXY, rose nearly 3% in the week, the best in more than 2 years | Anue Juheng


As the weak Purchasing Managers’ Index (PMI) intensified recession fears, both the pound and the euro fell to multi-year lows on Friday (23rd). , dragging down the pound by more than 5% for the week. The U.S. dollar index rose nearly 3 percent this week, its best weekly performance in more than two years. The yen closed in the red for the first time in a month.

In late New York trading, the ICE U.S. Dollar Index (DXY), which tracks the U.S. dollar against six major currencies, rose 1.5% to 113.02, another 20-year high, and DXY rose nearly 3% this week, the largest weekly increase since March 2020. maximum.

“The dollar has really become a safe haven in the market because the Russian-Ukrainian war and subsequent shocks did not affect U.S. goals,” said Juan Perez, head of trading at Monex USA.

The new British Chancellor of the Exchequer, Kwasi Kwarteng, announced a large-scale tax cut bill, hoping to revive domestic economic growth and combat inflation. The British Debt Authority plans to issue an additional $72 billion in funding this fiscal year.

After the news was announced, the pound tumbled, dropping 3.6% to $1.0847 in a single day, its worst performance in more than two years, as investors sold British government bonds, driving yields higher.

Perez believes that the UK’s budget proposal fails to reflect the needs and realities of the UK economy, and businesses may be asked to pay more in order to allow the government to get higher revenue. He also said that under severe recessionary pressures and the rapid market reaction, much of the UK’s economic growth may be driven by debt.

Separately, Britain’s economic activity slumped further in September, raising recession fears as businesses grappled with soaring costs and weaker demand, earlier British Markit PMI data pointed to.

In order to curb inflation, the Bank of England announced a 2-yard rate hike a few days ago, but failed to support the pound. Dragged down by today’s trend, the pound lost more than 5% this week, the largest weekly decline in two years.

The euro fell in tandem, dropping 1.5% to $0.9690, its lowest level since October 2002, partly due to a renewed slowdown in the euro zone’s September PMI, which intensified recession expectations.

The euro tumbled more than 3 percent this week, its worst weekly performance since March 2020.

The yen fell 0.7% to 143.32 yen against the dollar. After the Japanese authorities intervened in the foreign exchange market yesterday and encouraged the yen to bounce, the yen closed in the red for the first time in more than a month, up 0.3% for the week.

As of Saturday (24th) Taiwan time about 6:00 Price:

The dollar index was at 113.0336. +1.5646% The euro against the US dollar (EUR/USD) was quoted at $0.9690 per euro. -1.4643% GBP/USD was quoted at 1.0847 GBP/USD. -3.5994% The Australian dollar against the US dollar (AUD/USD) was quoted at 1 Australian dollar to 0.6526 yuan. -1.7317% The US dollar against the Canadian dollar (USD/CAD) was quoted at 1.3590 Canadian dollars per US dollar. +0.7712% The US dollar was quoted at 143.32 yen against the Japanese yen (USD/JPY). +0.6814%

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