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Dollar Strength Continues as Caution Prevails

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  • Safe Haven Dollar Remains Amid Concerns
  • GBP Stays Weak as Fuel Crisis Eases
  • Facebook Outage Symptomatic of Market Mood

The US Dollar forex market continued its period of now prolonged strength. The firm Dollar has not been particularly incited by anything positive from the US economy but merely from a period of ongoing caution from traders. This has continued into October and sees other major forex currencies like the GBP and Euro struggling to keep any positivity when paired with the Dollar. The easing of the fuel crisis in the UK has done little to bolster the currency, and yesterday’s multiple-hour outage at Facebook appears to be a fitting microcosm of the current mood on Wall Street.

Dollar Steadfast as Worries Keep Mounting

Those trading the US Dollar, or more appropriately, buying the Dollar, have experienced a period of strength in recent weeks that could not have been imagined just a short time ago. While some of this appears to be a continuation of the pessimism that plagued the end of September, traders are simply finding more reasons to move to the safety of the Dollar as October kicks off. 

The general risk-off mood that was prevalent to end September has yet to lift and the strong Dollar has managed to keep the Euro below 1.16 and the Pound pinned back under 1.36 with both currencies struggling to raise themselves having been much higher in the past 12 months. The US Service PMIs will be watched later today for any figures that could move the market. 

Pound Stays Down as Fuel Concern Subsides

The British government was quite clear that there was no shortage of fuel, simply a shortage of truck drivers to get the fuel to stations. This did little to quell public anxiety, but having drafted in some military forces and eased visa requirements for European drivers temporarily, it seems the British fuel supply is moving again.

Forex brokers though have noted this has still done relatively little to boost the Pound as it remains trapped under the weight of a strong Dollar and with the fuel woes now having been replaced by ongoing disagreements over the Brexit border situation in Northern Ireland which the UK has described as unworkable. 

Wall Street Toils Again to Start October

There were more losses on Wall Street to start October in what has been viewed as a continuation of a disappointing September on the street. Again big tech names fell victim with many of the names on the NASDAQ now counting big losses in recent weeks. This was only heightened by a 6-hour outage of Facebook, Instagram, and WhatsApp that saw the price of the company tumble more than 5%.

Early trading in the pre-market is looking more positive as the street tries to claw back some momentum but at the same time, Treasury Secretary Janet Yellen has issued a stark warning for the US to address its debt ceiling or face entering a recession.

Anthony is a financial journalist and business advisor with several years’ experience writing for some of the most well-known sites in the Forex world. A keen trader turned industry writer, he is currently based in Shanghai with a finger on the pulse of Asia’s biggest markets.

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