Risk appetite has waned in recent trading, events in Afghanistan have led to dollar strength.

Risk appetite has waned in recent trading, events in Afghanistan have led to dollar strength. Although approval ratings for President Biden are at their lowest since he took office, the dollars safe-haven status has boosted the currency.

Biden has been heavily criticised by both left- and right-wing media, comments made by about the US’s withdrawal from Afghanistan. Where the US to redeploy forces to the nation, we’d anticipate further dollar strength through increased military spending strengthening the economy.

Mr Bidens approval rating dropping to its lowest level since he took office also plays into the hands of former President Donald Trump who is likely to weaponize this event to push his own political agenda leading into the 2024 election.

The ONS this morning has reported that the UK’s inflation has fallen back in line with the Bank of England’s 2% inflation target. There had been fears inflation could hit 3% by the end of the year before subsiding. The dip from 2.5% has been attributed to falls in the cost of clothing and footwear.

Inflated shipping and haulage costs will likely continue to be a spectre as these costs will likely be passed on to consumers fuelling inflation, therefore inflationary pressures may rear their head again.

Economic Calendar

Expected Previous
07:00 GBP CPI (Y/Y) 2.3% 2.5%
13:30 CAD CPI (M/M) 0.3% 0.3%
15:30 USD Crude Oil Inventories -1.5M -0.4M
19:00 USD FOMC Meeting Minutes

*All rates shown are indicative of interbank rates and should only be used for indication purposes only. It is important to note that foreign exchange rates fluctuate and that rates may vary depending on the amount and the base currency that is purchased or sold. Rates are correct as of 8:00am UK time. CentralFX are not responsible for the rates shown.