U.S. rises on tax reform optimism, sterling weakens further on Brexit deadlock
|Market Review - 07/12/2017 00:08GMT
U.S. rises on tax reform optimism, sterling weakens further on Brexit deadlock
The greenback continued this week's gain and remained broadly higher against majority of its peers on Wednesday due to progress on U.S. tax reform and U.S. lawmakers' effort to avoid U.S. government shutdown this weekend.
Following Tuesday's lackluster session, the greenback remained under pressure versus the Japanese yen and tumbled to 112.00 at European morning on broad-based buying in yen due to risk aversion on broad-based decline in Asian and European stocks as well as falling U.S. yields. However, short covering in New York session lifted price to 112.37 before moving narrowly narrowly in afternoon trading.
The single currency continued its recent erratic decline n despite staging initial recovery from Tuesday 9-day low at 1.1801 to 1.1848 in Asia, price erased intra-day gain and tumbled to a 2-week trough of 1.1781 in New York morning on broad-based usd's strength.
Despite staging a minor rebound fm 1.3406 in Australia to 1.3436 in Asia, the British pound met renewed selling and resumed its recent losing streak, tumbling to 1.3388 at European morning on back of Brexit deadlok fear then ratcheted lower to 1-week lows of 1.3358 before rebounding to 1.3396 near New York close.
Reuters reported Ireland wants Brexit negotiations to move onto phase two next week once it is based on a text on the Irish border prepared this week but if that is not possible, talks can resume in the new year, Prime Minister Leo Varadkar said on Wednesday.
Reuters news, citing fm Belfast Telegraph, leader of N.Ireland's DUP said; 'party would "not be rushed" on agreeing a text on post-Brexit border.'
In other news, Reuters reported U.S. Senate Majority Leader Mitch McConnell said the Senate will vote later on Wednesday on whether to send its tax legislation to a conference to hammer out differences with the U.S. House of Representatives' version of the plan.
On the data front, private employers added 190,000 jobs last month, down from an unrevised 235,000 in October, the ADP National Employment Report showed. That was roughly in line with expectations for a gain of 185,000 jobs in a Reuters poll of economists, with estimates ranging from 150,000 to 240,000.
Data to be released on Thursday:
Australia AIG construction index, trade balance, exports, imports, Japan coincident indicator, leading indicator, Swiss unemployment rate, Germany industrial output, France current account, trade balance, imports, exports, U.K. Halifax house prices, EU GDP, U.S. initial jobless claims, and Canada building permits, Ivey PMI.
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