1 month ago
Forex

Dollar Struggles as Sterling Soars on Brexit-Delay Hopes

Investing.com – The U.S. dollar was under pressure Wednesday against a basket of major currencies following a sharp rise in

Investing.com – The U.S. dollar was under pressure Wednesday against a basket of major currencies following a sharp rise in the pound on fading worries the U.K. will leave the European Union without a trade deal.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell 0.23% to 96.09.

Labour, the main opposition party in the U.K., raised investor hopes that a no-deal Brexit would be averted after it signaled it would back a cross-party proposal seeking to extend the deadline by which the UK is required to leave the EU, should the government fail win support for a withdrawal deal.

The shadow chancellor, John McDonnell, told the BBC it was “highly likely” Labour could back the proposal, tabled by Labour's Yvette Cooper and Conservative Nick Boles.

The proposal would not revoke article 50, but would allow lawmakers to vote on whether to extend the article 50 deadline beyond March 29.

GBP/USD rose 0.89% to $1.3072.

EUR/USD gained 0.28% to $1.1392 ahead of the European Central Bank meeting scheduled for Thursday.

USD/JPY gained 0.18% to Y109.56 following weakness in the yen in the wake of the Bank of Japan's decision to stand pat on interest rates despite cutting inflation forecasts.

USD/CAD fell 0.04% to C$1.3348, but remained well above lows of C$1.3303 as a slide in oil prices and weaker-than-expected Canada retail sales data kept the loonie on the back foot.