USD Traders Waiting on Next Round of Data
The US dollar has been higher across the European morning today as equities have seen some downside in the face of ongoing uncertainty over Brexit and US/China trade negotiations. US and Chinese officials are due to hold further talks tomorrow aimed at paving the way for the recently agreed “phase one” trade deal to be signed. Ahead of those talks, focus tomorrow will be on durable goods and manufacturing data. Any further data weakness is likely to put an end to the current recovery in USD.
EUR Lower Ahead of ECB Tomorrow
EURUSD has been weaker today as the recovery in USD has seen selling pressure in the single currency ahead of tomorrow’s ECB meeting. The market is not looking for the ECB to make any policy adjustments tomorrow. However, traders will be keen to judge whether the bank is likely to make any further easing announcements this year. The recent patch of Eurozone data weakness in the Eurozone raises the risk of a dovish tone to tomorrow’s meeting. EURUSD trades 1.1112 last having fallen back below the 1.1127 level.
GBP Down Amidst Brexit Uncertainty
GBPUSD has been lower over the session so far today, weighed upon by a stronger US dollar and Brexit uncertainty. Following another parliamentary defeat last night, Boris Johnson has said that he will now wait to see if the EU agrees to extend Brexit once again as per the request made by the PM, in line with the terms of the recently passed Benn Bill.
Risk Assets Remain Firm
Risk assets have been higher across the European morning today, reflecting a sense of relief that Brexit now looks likely to be postponed once again. Furthermore, following phone calls on Monday, US and Chinese officials are due to speak on Friday which is keeping the market hopeful that a trade deal will indeed be signed between the two nations. SPX500 trades 2995.13 last.
Gold Higher, JPY Lower
Safe havens have both been firmer today with JPY and gold trading higher against USD. With the market still pricing in an October rate cut from the Fed, gold price remains underpinned here. XAUUSD trades 1492.58 last, still holding above 1481.93 support. USDJPY trades 108.44 last having been rejected at the 108.84 level.
Crude Lower On Inventories Build
Oil prices have seen some weakness today as the market waits for the headline EIA report to be released later. The API report released yesterday showed a further build in US crude stores which weighed on prices. If the EIA report today confirms this build, further downside will likely be seen. Crude trades 54 last, still capped by the 55 level resistance.
CAD Under Pressure
USDCAD has been a little lower today despite a stronger USD and weaker oil prices. USDCAD trades 1.3099 last, still sitting above the 1.3068 support following the last two weeks of declines which have seen price falling from highs above 1.33. For now, focus remains on further weakness in the near term.
AUD Retreats For Now
AUDUSD has been a little lower today so far as uncertainty around US/China trade negotiations has seen a pause in recent upside momentum. However, with talks due to continue on Friday there is still room for further upside in AUD should we see positive headlines around the talks. AUDUSD trades .6845 last, sitting back below the .6850 level as of writing.