Dollar pushes higher, sterling down 1% on Brexit fears


The dollar pushed higher against a basket of the other major currencies on Monday as the U.S. jobs report for December supported the case for rate hikes, while sterling tumbled amid worries over the prospects of a ‘hard Brexit’.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose 0.28% to 102.46.

The Labor Department said Friday the U.S. economy added 156,000 jobs in December, falling short of economists forecast for jobs growth of 178,000.

The report also showed that the annual rate of wage growth rose to 2.9% in December from a year earlier, the strongest since 2009.

The employment data indicated that the economy is on a strong enough footing for the Federal Reserve to keep pushing up interest rates.

The Fed has indicated that three quarter-percentage-point interest rate increases are on the cards for 2017.

Higher rates boost the dollar by making the currency more attractive to yield-seeking investors.

The dollar was little changed against the yen, with USD/JPY at 117.05, down from an intra-day high of 117.53.

The euro slid lower, with EUR/USD losing 0.18% to trade at 1.0514.

The pound was sharply lower against the dollar and the euro, with GBP/USD shedding 1.14% hit 1.2141, the lowest level since October 31.

EUR/GBP hit highs of 0.8679, the strongest level since November 15 and was last at 0.8658, up 0.97% for the day.

The selloff in sterling came as comments by British Prime Minister Theresa May on Sunday were seen as an indication that the UK won’t try to negotiate continued full access to the European single market when it leaves the European Union.

On Monday, a Downing Street spokeswoman said that May “hasn’t ruled anything in or out” ahead of Brexit negotiations and wants the best deal for businesses to trade with the single market.

Elsewhere, the Turkish lira fell to a fresh record low against the dollar on Monday after ratings agency Moody's said that bank profits will be hit by an increase in bad loans this year and warned of a "general worsening" in the investment climate in the country.

USD/TRY jumped 2.46% to trade at 3.7338 after starting the day at 3.6433.

Bmfn global

Boston Merchant Financial Ltd is licensed by The Federal Financial Markets Service Licence Number: 1220

Bmfn europe

BMFN EAD regulated and authorised by the Financial Supervision Commission (FSC) Register. Number: RG-03-220

Bmfn Australia

BMFN Pty Ltd is licensed and regulated by Australian Securities & Investment Commission (ASIC) ABN 14 145 724 509, AFSL Number 379035


BMFN PTY Ltd is registered as a Financial Service Provider and listed in the Financial Service Providers Register (FSPR), FSP328066


Risk Warning: CFDs are margined products; it is possible to lose more than your initial margin deposit or credit allocation as well as any variation margin that you may be required to deposit from time to time. Therefore you should only speculate with money that you can afford to lose. CFD trading may not be suitable for all customers; therefore please ensure that you fully understand the risks involved and seek independent advice if necessary and prior to entering into such transactions. When trading CFDs with Boston Merchant Financial you are merely trading on the outcome of a financial instrument and therefore do not take delivery of any underlying instrument, nor are you entitled to any dividends payable or any other benefits related to the same. Please be advised, the services and products described on www.bmfn.com and offered by Boston Merchant Financial, Ltd. (BMFN) are not being offered within Canada, the United States or Belgium and not being offered to U.S., Canadian and/or Belgium residents or citizens, as defined under applicable law. BMFN and its products and services offered on the site www.bmfn.com are NOT registered or regulated by any U.S. or Canadian regulator and not regulated by FINRA, SEC, NFA or CFTC.

BMFN reserves the right to retroactively charge storage fees for positions held for extended period of time as stipulated by the market liquidity provider.