The dollar continued today (Friday December 19) the recovery it started yesterday after falling 5.3% against the euro this week after the US Federal Reserves cut its target Fed Funds rate on Tuesday to an unprecedented 0%-0.25%.
By 5pm London time, the dollar had gained nearly three quarters of a penny, almost two euro cents and ¥0.07.
Traders believe forex derivatives may become more active during this intensely volatile period for currencies and interest rates.
Although the pound rallied by nearly two cents today against the euro, it was down ¥1.05 and a cent and a half against the dollar. The pound was worth €1.12 on Monday, on a daily average basis; today it only buys €1.07.
Sterling’s weakness, already pronouced, has intensified since the...