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Dollar Recovers From Mid Term Election Losses

The dollar rose this morning, pulling away from lows hit yesterday, as the market breathed a sigh of relief after the U.S. midterm elections and as investors turned their attention toward the Federal Reserve policy meeting.

The Federal Reserve is expected to keep interest rates on hold but signal further tightening in December.

Analysts said that with the U.S. midterm elections producing no major surprises a central bank sticking to its tightening path should support the dollar, while the euro will likely remain under pressure from concerns about Italian debt.

British pound continues recent highs after a strong rally on the back of optimism for a Brexit deal between Britain and the European Union.

While it is still possible later in November, Irish Prime Minister Leo Varadkar warned on Wednesday that chances for a deal this month were fading.

For Britain, it is important to lock a deal before the turn of the year to give businesses the clarity they need to plan for the first quarter of 2019 when Britain is due to become the first country ever to leave the EU.

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