FX round-up: Dollar down against neighbours' currencies after Clinton-Trump debate

Cable was on the back-foot once again at the start of the week, albeit amid lighter than usual trading conditions given the Columbus Day holiday Stateside, with many traders, and some corporates such as Sports Direct, also likely still licking their wounds following the previous week's carnage in the currency pair.

As of 1900 BST the pound was thus down by 0.62% to 1.2356.

Of interest, according to the latest IMM data short sterling trades jumped from $7.1bn to $7.8bn during the week ending on 4 October.

That came as analysts at Citi argued that by invoking Article 50 early the UK had given away one weak bargaining chip.

"Given that big decisions are likely to be taken late in the process and that extending it requires unanimity, uncertainty may spike in early 2019. UK confidence indicators have rebounded. But growing risks about the process and outcome of the Brexit negotiations could raise short-term uncertainty again, as witnessed by sterling’s latest drop," the broker's analysts said.

For their part, in a weekly bulletin sent to clients FX hedging specialist JCRA said: "The prospect of another two years of acrimony is particularly unappealing, not least on account of the impact of protracted uncertainty on financial markets. Indeed, Philip Hammond suggested last week that Friday morning’s price action is the sort of thing that he expects for the next five years. If this is the case, it may well be better simply to cut loose, opting for hard Brexit with unilateral tariff-free trade on imports into the UK.

"Hard Brexit is the quickest way to bring certainty to the markets and define a base for sterling, but that will not stop the pound being sold off further in the short term as this uncomfortable truth becomes recognised."

Euro/dollar skidded 0.6% to 1.1133, while dollar/yen strengthened 0.8% to trade at 103.74 in the wake of the latest televised debate between the two main contenders to the US presidency.

However, while the greenback was trading up against the euro and the pound, it was lower against the main commodity currencies, particularly against the Loonie which was trading 0.99% higher to 1.3166.

Nonetheless, one of the biggest moves to the downside came against its other main neighbour, Mexico, with the peso 2.19% stronger at 18.88.