- US Dollar stable as China - US trade deal edges closer
- Central bankers rule the day
By David Johnson
China-US deal edges closer
The Trade dispute between China and the US may have a solution emerging on the horizon and the markets took that as a very positive sign. Wall Street’s equities indices closed higher on Friday, even as the US President is being corralled into explaining the Russian connection in the last election. Nevertheless, the US Dollar is stronger and there is a lot of talk around the markets of the GBPUSD rate falling further. That doesn’t mean it will happen without a catalyst of some sort, but it is a potential outcome.
Euro and Turkish Lira stabilise
The Turkish Lira has stabilised a little in spite of the credit ratings agencies shifting Turkish sovereign debt into the dustbin section of the ‘Junk bond’ zone. That has allowed the Euro to stabilise as well, but there is plenty of volatility ahead as the UK–EU Brexit negotiations continue. It may be that the markets have woken up to the fact that people says things they don’t mean during negotiations. The prevalence of ‘no deal’ rhetoric is a case in point. No negotiators really want to be considered a failure, so a deal of some description is the most likely outcome.
Central bank speeches a-plenty
Today’s calendar includes speeches from members of the Bank of Canada, US Federal Reserve, Bundesbank and Reserve Bank of Australia (RBA). That theme continues tomorrow with the release of the minutes from the last RBA meeting and a speech from the RBA governor. The minutes from the last US Federal Reserve meeting are released on Wednesday.
Tales of the unexpected
There is a little data due in between these central bank events, but that is limited, as it often is at this time of the month. So traders will be looking for unexpected triggers for market movement.
And ‘unexpected’ is definitely a word you could use for events at the Southers Marsh Golf Club in Plymouth, Massachusetts, over the weekend. After a heated argument over a game of golf escalated into one player biting the other player’s finger off. That’s strange and violent, but he was charged by the police with ‘Mayhem’. Now, that is a cool crime to be charged with. So much more creative than ‘Actual bodily harm’.