US Dollar Jitters as US Elections Come Closer

The US dollar ended the week rather soft as the upcoming US presidential elections overshadowed all other events. And as the outcome of the vote became more uncertain, traders were reluctant to hold the US currency.

At the start of the week, it looked like markets shrugged off the reopened investigation of Hillary Clinton’s emails by the Federal Bureau of Investigation. Yet market participants kept their focus on the news throughout the week, and this was not good for the greenback. US nonfarm payrolls were mixed, giving the dollar no help but not hindering the currency too much either. The Federal Reserve kept its policy unchanged but signaled that the case of an interest rate hike is strengthening.

Talking about central banks, the Bank of Japan and the Bank of England also held policy meetings during the week. Both central banks kept their policies unchanged, though the BoE changed its stance, no longer expressing desire to ease its monetary policy. It was a positive sign for the Great Britain pound, which also got a major boost from the UK High Court ruling that the government needs parliamentary approval to proceed with the Brexit.

EUR/USD rallied 1.4% from 1.0985 to 1.1138. GBP/USD surged 2.7% from 1.2184 to 1.2519. USD/JPY sank 1.4% from 104.57 to 103.07.

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