Forex – U.S. Dollar Rises as Equities Tumble

© Reuters. – The U.S. dollar was higher on Wednesday as investors flocked to risk-averse assets on fears of a global slowdown.

The , which measures the greenback’s strength against a basket of six major currencies, rose 0.6% to 96.30 as of 10:17 AM ET (15:17 GMT).

Wall Street had its worst year in a decade in 2018 and the first trading day of the year turned bearish as traders remained cautious after declining factory data from China.

Meanwhile, the U.S. government remains closed and while Congress is expected to meet on Wednesday, there is no indication of when the shutdown will end soon. A tweet from U.S. President Donald Trump late on Tuesday suggested he could be open to deal.

The dollar was down against the safe-haven Japanese yen, with shedding 0.3% to 109.32.

Elsewhere, slumped 1% to 1.2619 after activity in the UK manufacturing sector jumped to a 6-month high in December, as companies prepare for the uncertainty of a hard Brexit, IHS Markit said in its monthly report.

Prime Minister Theresa May’s Brexit draft deal is expected to come before the British Parliament for a vote before the end of January, but questions remain over whether it will pass. Government officials remain wary of the European Union’s backstop deal over the Northern Ireland border and have asked for assurance that the deal is temporary.

The euro was also down, with dipping 0.8% to 1.1366. decreased 0.6% to 0.6673 while fell 0.8% to 0.6996. The Canadian dollar increased with down 0.3% to 1.3595.

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