U.S – China Trade Tensions Could Spike and Overshadow the Numbers…The HK Bill in support of the protestors is on its way to the Oval Office. Trump’s signature may well raise doubts over a phase 1 trade agreement.
Earlier in the Day:
It’s a particularly quiet day on the economic calendar through the Asian session this morning.
There are no material stats to provide the markets with direction through the early part of the day.
The lack of stats leaves risk sentiment in the hands of geopolitical risk.
On the geopolitical risk front, negative sentiment towards trade left the U.S equity markets in the red on Wednesday, leading to further risk aversion in the early part of this morning.
News of Congress sending the Bill in support of HK to the U.S President to sign leaves the chances of a phase 1 agreement in the balance. A presidential signature could sink any near-term hopes of an agreement and riskier assets
There was nothing from the FOMC meeting minutes to shift sentiment towards FED monetary policy
Across the Majors
The Day Ahead:
For the EUR
It’s yet another quiet day ahead on the economic calendar. While there are no material stats scheduled for release to provide the EUR with direction, we can expect some influence from Eurozone consumer confidence figures due out late in the session.
The ECB monetary policy meeting minutes due out ahead of the stats will also provide direction.
Expectations are for the ECB to now stand pat on policy. Any hints of further easing would weigh heavily on the EUR.
Geopolitics will also influence throughout the day, with a phase 1 trade agreement now at risk…
At the time of writing, the EUR was up by 0.03% to $1.1076.
For the Pound
It’s also another quiet day ahead on the data front. There are no material stats due out of the UK to provide direction to the Pound.
The latest opinion polls and predictions will be the key driver on the day as the polls reflect voter sentiment ahead of tomorrow’s next leadership debate.
At the time of writing, the Pound was up by 0.01% to $1.2925.
Across the Pond
It’s a busier day on the economic calendar. Stats due out of the U.S include Philly FED manufacturing PMI numbers, existing home sales and weekly jobless claims figures.
Barring an unexpected jump in the initial jobless claims, we would expect the Philly FED to have the greatest impact.
Outside of the numbers, however, any updates on trade talks would likely overshadow the numbers on the day. Trump could materially impact progress should he sign the HK Bill…
The Dollar Spot Index was up by just 0.02% to 98.878 at the time of writing.
For the Loonie
It’s a quiet day on the economic calendar. There are no material stats due out of Canada to provide the Loonie with direction.
On the monetary policy front, Bank of Canada Governor Poloz is due to speak later today. Following some mixed numbers out of Canada of late, expect the Loonie to be sensitive to any monetary policy chatter.
The Loonie was down by 0.02% to C$1.3307, against the U.S Dollar, at the time of writing.