A Sunday Times report that an all-UK customs deal will be written into the agreement governing Britain’s withdrawal from the EU had cheered investors who sent the pound to $1.3062 on Monday, the highest since Oct. 22.
The dollar’s index versus six major peers was steady at 96.50 on Monday.
Such a rise is expected to help the dollar firm against the safe haven Japanese yen, which traded flat at 113.22 on Monday.
The offshore yuan traded lower versus the dollar at 6.9123.
The positive sentiment around a smooth Brexit also gave the euro a small bid in early Asian trade. However, the single currency gave up all its gains and traded flat at $1.1385.
• The elections matter because both houses of Congress are currently controlled by President Trump's Republican Party.
If Democrats take back control of the House or the Senate, they could severely limit what he can do in the final two years of his term.
In the House, analysts predict dozens of seats could change hands and the majority of these are currently held by Republicans.
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• The election-eve NBC News/Wall Street Journal poll shows Democrats leading by seven percentage points, 50 percent to 43 percent, among likely voters. That's down from a nine-percentage point lead last month.
• China, Japan and Germany accounted for nearly two-thirds of America’s $652.4 trade deficit in the first nine months of this year.
Expect a long period of rolling and intractable trade disputes.
That will dampen U.S. economic growth and depress asset prices.
• China will lower import tariffs and continue to broaden market access, President Xi Jinping said on Monday at the opening of a week-long trade expo seen as an attempt by Beijing to counter mounting criticism of its trade and business practices.
Xi also promised to accelerate opening of the education, telecommunications and cultural sectors, while protecting foreign companies' interests and enhancing punitive enforcement for infractions of intellectual property rights.
Xi's remarks come at a time of heightened tension between China and some of its biggest trade partners, particularly the United States, which has imposed tariffs on $250 billion worth of Chinese goods so far. China has retaliated with $110 billion worth of tariffs on U.S. goods.
Xi said the import expo showed China's desire to support global free trade, adding that countries of the world must pursue open policies and oppose protectionism.
• Bank of Japan Governor Haruhiko Kuroda ruled out the chance of a near-term interest rate hike, arguing that doing so now would only add to strains for financial institutions by threatening to derail the country’s economic recovery.
• South Korea has been granted a waiver from the United States on Iranian oil imports just as U.S. sanctions against Tehran come into force, a South Korean government official said on Monday.
The United States said on Friday it would temporarily allow eight importers to keep buying Iranian oil after it re-imposed sanctions on the country's crude flows from Monday, aiming to force Iran to curb its nuclear, missile and regional activities.
Under U.S. law, exceptions can be granted for up to 180 days.
Iran's biggest oil customers — all in Asia — have been seeking waivers to sanctions to allow them to continue buying some of the Islamic republic's oil.
• Iran plans to defy newly reimposed U.S. sanctions and continue to sell, Iranian President Hassan Rohani reportedly said on state TV on Monday, according to Reuters.
• Oil prices fell on Monday as U.S. sanctions against Iran’s fuel exports were softened by waivers allowing major buyers to import Iranian crude for a while, while Tehran said it would defy Washington and continue to sell.
Brent crude oil LCOc1 was down 30 cents a barrel at $72.53 by 0815 GMT. U.S. light crude CLc1 was 30 cents lower at $62.84 a barrel.
Both oil price benchmarks have lost more than 15 percent since hitting four-year highs in early October, as hedge funds have cut bullish bets on crude to a one-year low, data show.
Reference: Reuters, CNBC
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