Currency Outlook

OCTOBER 2019 – IN BRIEF

What Happened

  • Greenback’s strengthening tested as it appreciated by just 0.25% overall, very mixed
  • Interest rate cuts and a return to risk-appetite lifted Dow Jones Average 3.4%, S&P 2.7%
  • Safe-haven Yen and Swiss Franc lost 1.5% on avg. of their value with the rise in optimism
  • Canadian Dollar and Mexican Peso up by close to 1.0% with oil prices surging 2.7%
  • Euro-bloc’s woes continue as a lower deposit rate and return to QE caused a 0.7% loss
  • Chaos characterizes the current situation in the U.K., but the push towards a Brexit resolution of any kind lifted Sterling by 1.82%

Tempus’ View

  • The buck could have lost more in September, but renewed fears of trade conflict escalation rallied it as a safe-haven asset at month-end
  • Progress in the form of agricultural purchases teased global markets, but a deal is desired
  • The constitutional impasse in the U.K. may lead to delay elections and a second Brexit vote, thus improve GBP further
  • Canada’s general election on October 21st could lead to “Loonie” rise with govt. change
  • A drop in Gross Domestic Product as we measure Q3 may inspire doubts on the dollar’s mighty consistency

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