The new British finance minister, Jeremy Hunt, on Monday scrapped Prime Minister Liz Truss’s economic plan, which had undermined investor confidence in the UK in recent weeks.
The relief for the change of course triggered a rally in risky assets, including on Wall Street, which was boosted by strong corporate results from Goldman Sachs and Johnson & Johnson.
Hunt’s decision to backtrack on most of the government’s “mini-budget” led investors to reassessing the outlook for British interest rates and sent the pound down 0.4% on the day to $1.13155.
Against a basket of currencies, the dollar rose 0.07% to 112.15, having earlier fallen to a nearly two-week low of 111.76. The index, which had lost 1% in the previous session, remains 2% from the two-decade high of 114.58 reached at the end of September.
The yen was trading near a 32-year low at 149 per dollar, putting the important psychological barrier of 150 yen in the spotlight and raising the possibility that the Bank of Japan (BoJ) will further support the battered currency. after having intervened on September 22 with purchases for the first time since 1998.
Source: Ambito
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