Sterling jumps after no-deal Brexit rejected; dollar softer

  • Sterling jumps after no-deal Brexit rejected; dollar softer

Sterling jumps after no-deal Brexit rejected; dollar softer

U.K. lawmakers have rejected the idea of tearing the country out of the European Union with no agreement, and U.K. Prime Minister Theresa May is said to be planning to seek an extension to the March 29 Brexit deadline lasting about two months. The currency was headed for its biggest daily gain against the dollar in 2019.

The Bloomberg Dollar Spot Index advanced 0.3 percent, the first advance in a week.

The pound was last up 0.01 percent at $1.318 after a rollercoaster ride this week in which its price has moved within a range of 3-1/2 cents against the dollar.

US/CAD: The Canadian dollar strengthened to a nine-day high against its US counterpart on Wednesday, as rising stocks and oil prices offset domestic data showing the fifth consecutive monthly decline for home prices. This is the latest sign of benign inflation, supporting the Federal Reserve's wait-and-see approach to further interest rate hikes this year.

NEW YORK, March 13 (Reuters) - World equity markets broadly rose on Wednesday, lifted by investor optimism that British lawmakers will rule out a no-deal Brexit and fresh USA data that highlighted a strong economy with low inflation, an outlook that weakened the dollar. The price of oil, one of Canada's major exports, rose as US crude inventories unexpectedly fell and an official forecast of crude oil supply growth from the world's top producer was revised lower. Immediate resistance can be seen at 1.3300 (Psychological Level), an upside break can trigger rise towards 1.3365 (61.8% retracement level).On the downside, immediate support is seen at 1.3273 (21 DMA), a break below could take the pair towards 1.3264 (50 DMA). USA stocks have extended gains this week as economic data comes in neither too hot nor too cold, while traders in Europe on Thursday seemed to be shrugging off more warning signs from the region - perhaps because of hopes Brexit can be delayed or derailed. The U.S. central bank's rate-setting committee will issue its next policy statement following its March 19-20 meeting.

The dollar was 0.35 percent higher at 111.53 yen after losing 0.2 percent the previous day.

UK lawmakers rejected the idea of tearing the country out of the European Union with no agreement and UK Prime Minister Theresa May was said to plan to ask for an extension to the March 29 Brexit deadline lasting about two months.

Wednesday's vote boosted investor optimism in European equities too, with the pan-European STOXX 600 index climbing 0.6 percent while London's FTSE 100 added 0.1 percent as sterling extended gains.

On Wall Street, the Dow Jones Industrial Average rose 155.29 points, or 0.61 percent, to 25,709.95.

The pound steadied after surging in the wake of the United Kingdom parliament's vote that opened the door to delaying Brexit.

The dollar was on the back foot after data on Tuesday showed USA consumer prices rose at a slower-than-expected pace, nudging Treasury yields to two-month lows.

Benchmark 10-year U.S. Treasury notes fell 2/32 in price to push yields up to 2.6141 percent.

Britain's 10-year yield advanced three basis points to 1.227 percent, the highest in more than a week.

Gold sank 0.8 percent to $1,298.54 an ounce, the biggest dip in nearly two weeks. West Texas oil climbed above $57 a barrel after an industry report showed an unexpected drop in USA fuel supplies.

Elsewhere, oil pushed above US$58 a barrel in NY, boosted by a decline in U.S. crude and fuel stockpiles, adding to evidence of a tightening market. US crude oil futures settled at $58.26 a barrel, rising $1.39 cents, or 2.44 percent.