The euro dropped to its lowest level since July 29 as fading hopes for an Iran breakthrough drove traders toward the US dollar. Denials over a possible Strait of Hormuz deal and a lack of detail in Trump's UN speech left the market pricing in "no deal" for now.
Traders pushed the euro down 30 pips on the day as optimism about a breakthrough in Iran diplomacy faded after Trump's UN speech. The move put the pair at its lowest level since July 29.
A report from Kyodo earlier suggested Iran was willing to open the Strait of Hormuz in exchange for the US lifting its blockade, but FARS denied the report, and Trump made no mention of it in his UN speech. Instead, he said a deal was likely after the midterms.
Trump would naturally want an agreement before the midterms to help preserve Republican control, but it doesn't look like he sees that as possible. Still, there are credible reports that neighboring countries are working the diplomatic angle, so the situation could shift quickly.
The market is voting for "no deal" for now, with WTI rising to $91.68 from a low of $89.16. That same sentiment has driven dollar bids, lifted yields and pushed the euro lower, leaving it without much support until the July low of 1.1350.
Source: Investinglive
Trading involves risk.
Risk Disclaimer
