The US dollar, having reached its heights last week, approached a 16-month peak. At the same time, the British pound remains under pressure amid no-deal Brexit fears.

Extending a rapid rally of the last week, the US dollar reached a 16-month high. At the same time, the British pound remains under pressure due to the deadlock in the Brexit deal.

Most investors expect the Fed to continue tightening monetary policy. The Federal Reserve confirmed its intention to raise interest rates by 25 basis points next month. According to the Fed, two more interest-rate increases are expected by mid-2019.

The US currency finds support from a variety of factors such as risk aversion sentiment due to the trade dispute between Washington and Beijing, a slowdown in China’s economy, and uncertainty about Brexit.

The British pound declined by 0.35% to $1.2928. That was caused by mounting tensions in the British government. The policymakers argue fiercely over a blueprint for the terms of the UK exit from the EU.

The euro fell against the US dollar for three sessions in a row. Italy's budget dispute triggered deterioration of the investor sentiment.

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