US dollar dropped slightly in the hope of a Fed rate cut

The US dollar dropped slightly on Monday in the hope of a Fed rate cut later this week, while the Brexit extension contributed to the rise in the euro.

29 October 2019, AtoZMarkets – The US dollar index, which measures the strength of the greenback against a basket of six major currencies, fell 0.1% to 97.558 at 10:46 ET (13:46 GMT). The Fed is expected to lower rates for the third time this year at its Wednesday meeting. Still, investors are waiting for comments at a central bank press conference to see if policymakers will continue to ease monetary policy.

The Bank of Japan also expected to meet this week. And its monetary decision will be monitored on Thursday. It faces uncertainty over the fallout from the US-China trade war.

EURUSD Fundamental Analysis – 29 October 2019

Elsewhere, the pound and euro rose after EU Council President Donald Tusk confirmed on Twitter on Monday. That the EU has agreed to extend the deadline for Brexit until 31 January 2020, in line with the request of the British government at the beginning of the month.

GBP / USD rose 0.3% to 1.2858 while EUR / USD rose 0.1% to 1.1091.

The deal is likely to include an early exit. So, the UK accepts a withdrawal agreement before, according to various reports.

The British Parliament is expected to vote next Monday on whether to hold parliamentary elections. That is before Christmas in an attempt to ratify the EU’s withdrawal agreement with Prime Minister Boris Johnson.

The vote took place only hours after EU leaders offered to delay Brexit until 31 January. And they also allowed the UK to leave earlier if they adopted the EU withdrawal agreement. Johnson established in a letter to EU Council President Donald Tusk. That the United Kingdom had officially accepted the offer of extension.

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