Dollar Index Falls .1%, Pound Sterling Gains

On Tuesday the dollar index fell 0.1 percent, the pound sterling rose after reports that the ‘Brexit deal’ may soon be reached.

The dollar index that measures the greenback against a basket of six major currencies fell 0.1 percent at 95.67 following its peak for 7 weeks at 96.155.

The 10-year Treasury yield benchmark rose 3.261 percent, to a seven year high and settled at 3.2101 percent at the end of trading on Tuesday over concerns on global growth and weaker equity prices.

European Currencies

News reports that the European Union and Britain were close to reaching the Brexit deal saw the pound sterling gain 0.43 percent to $1.3144, reversing its earlier drop.

Reports that the Irish border differences between both parties had been resolved, but that there were other issues that still needed to be resolved, according to undisclosed diplomates.

The euro dropped to a seven week low of $1.14325, down 0.1 percent at 129.980 yen.

Controversial budget plans by Giovanni Tria, the Italian Economy Minister earlier where he announced his controversial budget plans saw 10 year government benchmark yield rising towards a 4 and a half year high.

Managing director at FX, BK Asset Management in New York, Boris Schlossberg said that worries and tensions between the EU and Italy concerning the budget negotiations saw the euro weakening. Then the reports of the Brexit deal, flipped everything around.

The pound gained against the euro gaining 0.36 percent settling at 87.45 pence to the euro.

Asian News

While in China, the Central bank cut bank reserve requirements in an effort to give more liquidity to the banks, as the trade row with the United States heats up. The yuan fell to 6.9158 near seven week lows against the dollar.

Global growth forecasts for 2018 and 2019 were reduced by the IMF on Tuesday from 3.7 percent to 3.9 percent.

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