After holding up well for much of yesterday’s session, the exchange rate of EUR/USD fell last night as uncertainty over Brexit weighed on the euro (EUR). The losses of the pair have been modest, and recovery is possible in the coming days.
October 22, 2019, | AtoZ Markets – After the impressive EUR/USD gains last week from 1.1039 to 1.1770, this week’s moves have been much closer so far. The EUR/USD held yesterday and briefly referred to a post-August record of 1.1177. However, the pair is down today, and trends are close to the 1.1144 level.
The new policies influence the exchange rate of the EUR/USD, but the data could stimulate the move later in the week.
Euro (EUR) exchange rate bearish on fresh Brexit uncertainties
The demand for the euro has been boosted by the news of Brexit this week so far. It happened in a context of lack of data or news influential in the euro area. As the Brexit process is likely to have an impact on the euro area as well, the euro is often affected by Brexit developments alongside the pound (GBP).
On Monday, the UK House of Speaker John Bercow ruled that the government could not hold another meaningful vote on its Brexit plan that day. This is because it would be a Saturday rehearsal when Parliament decided not to hold a meaningful vote following the adoption of the Letwin amendment.
Blocking a meaningful vote meant that the chances of getting an agreement before the 31st had decreased, making another delay more likely. Nevertheless, in the hope that the government agreement will eventually succeed, the losses of the euro have been limited.
EUR/USD exchange rate could resume advance on Brexit developments
As a result, developments in Brexit and US-China trade relations will likely continue to drive Euro to US Dollar (EUR/USD) exchange rate movement for now. The economic calendars of the eurozone and the United States will be relatively calm over the next day, except for the confidence of French companies and consumers in the euro area tomorrow.
As a result, the evolution of trade relations between Brexit and US-China will likely continue to cause the exchange rate of EUR/USD to evolve at the moment. The British government plans to hold a parliamentary vote today on the Brexit withdrawal agreement, after which it could conduct another significant vote on its Brexit plan.
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