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Euro, pound leap against the US dollar

The euro and the pound abruptly jumped against the buck in early New York trading on Tuesday, with the common currency coming within a whisker of $1.17.

The euro climbed as much as 0.49 per cent to $1.1699, while sterling advanced 0.37 per cent to $1.3077. The buck managed to hold gains against the Japanese yen, recently up 0.24 per cent to Y111.37.

Tuesday’s moves for the two European currencies appeared to accelerate moments after US President Donald Trump issued the following tweet:

Working on major Trade Deal with the United Kingdom. Could be very big & exciting. JOBS! The E.U. is very protectionist with the U.S. STOP!

Investment houses, which came into the year with a very bullish dollar outlook, have taken a dimmer approach given the greenback’s dismal performance this year against developed-market currencies. Just this week BNP Paribas, the French bank, yanked away its bullish dollar call.

(Chart: Bloomberg)