After a disappointing streak to March lows, today we observe a slight recovery in the value of the American dollar. Despite consumer price index data coming in short yesterday, indicating a faster slowdown in the American economy, the USD was able to strengthen a little against the euro and the British pound. Today we find the dollar index at 96.957. However, the concerns regarding the economy of the United States still remain, so the upwards momentum might not last long.
The appreciation of the value of the USD is actually caused by external factors, weakening the other currencies in each pair. A major point against the euro was yesterday’s statement by Donald Trump that he might punish the European Union for buying Russian natural gas. Trump wants the EU to increase their gas imports from the United States, but the bloc is already working with Russia on a new pipeline plan.
Meanwhile, the British pound is suffering today because of Brexit disputes. The United Kingdom is currently without a government (Theresa May’s team is just in place until a new Prime Minister is elected) and remains divided over the issue. The Labour Party tried to pass a motion that would put hard Brexit off the table but it failed. A no-deal Brexit prospect is damaging to the sterling, so naturally the GBP sagged.
