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Politics Help Dollar End Week Strong

October 21, 2017 at 17:22 by Vladimir Vyun

US dollar banknotes and coinsPolitics played a major role in the moves on the Forex market during the past week. That was beneficial for the US dollar, but not so much for other currencies, including the euro, the Great Britain pound, and the New Zealand dollar.

The major supportive factor for the greenback was the fact that Senate was able to approve a budget draft. Experts considered it to be a major stepping stone on the way to the planned tax reform.

News from the other parts of the world was not so good. In Europe, the issue of Catalan independence and the threat that Spain may take a direct control over Catalonia by force continued to plague markets, though surprisingly enough it had small impact on the euro. The shadow of the Brexit was still hanging over Britain and by the same extend over the pound, though the speech of Prime Minister Theresa May alleviated concerns to a degree. The New Zealand dollar suffered, perhaps, the most from politics as the changes in the government led to a sharp drop of the currency.

EUR/USD dropped from 1.1810 to 1.1779 over the week. GBP/USD declined from 1.3298 to 1.3187, reaching the low of 1.3087 during the week. NZD/USD slumped as much as 2.9% from 0.7172 to 0.6963.

If you have any questions, comments, or opinions regarding the US Dollar, feel free to post them using the commentary form below.

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