EU Session notes: GBPUSD slumps to record lows
- GBPUSD tumbled to a record low on Monday as traders scampered for the exits on speculation the new government's economic plan will stretch Britain's finances to the limit. Sterling slumped as much as 5% to an all-time of $1.0327, before stabilizing around $1.05425, 2.9% below the previous session's close.
- The dollar built on its recovery against the yen following the shock of last week's currency intervention by Japanese authorities, as investors returned their focus to the divergence between a hawkish Federal Reserve and the Bank of Japan's insistence on sticking to massive stimulus. The dollar index reached 114.58 for the first time since May 2002 before easing to 114.02, 0.78% higher than the end of last week.
- Oil prices fell for a second day on Monday on fears of lower fuel demand from an expected global recession sparked by rising worldwide interest rates and as a surging U.S. dollar limits the ability of non-dollar consumers to purchase crude. West Texas Intermediate (WTI) crude futures for November delivery dropped to $78.26.
- Gold prices were pinned near a two and half year low on Monday, pushed down by a firmer US dollar as major central banks adopted an aggressive stance on interest rates to tame inflation. XAUSUD was down at $1,637.85 per ounce.
