Forex Today: Brexit talks go down to the wire, dollar remains depressed, US-Sino relations sour
|Here is what you need to know on Thursday, October 17:
- The EU Summit on Brexit begins today and things are going to the wire. Prime Minister Boris Johnson continues to work to convince the Northern Irish Democratic Unionist Party (DUP) to support the consent and customs mechanism. The opposition may try to attach a condition to support the deal – bringing the accord to a referendum. The government will bring a motion to confirm a special sitting of parliament on Saturday. Most of the details have been ironed out with the EU with only VAT remaining on the agenda. GBP/USD kicks off the day just above 1.28, off the highs of 1.2877 but up over 600 pips in one week.
- Weak US Retail Sales published on Wednesday somewhat weighed on the US Dollar, allowing EUR/USD to edge closer to 1.11. The Federal Reserve's Beige Book showed modest to moderate growth in the US economy. US Building Permits, Housing Starts, and Industrial Output are scheduled for today.
- Robert Kaplan, President of the Dallas branch of the Federal Reserve, has seemed non-commital to another rate cut after supporting the previous two. John Williams, his colleague from the New York Fed and two other members of the world's most powerful central bank speak today ahead of the Fed's quiet period. The chances of a rate cut have risen.
- US-Sino relations: Washington slapped rules on Chinese diplomats operating in the US in retaliation to limits on American officials. China responded angrily by saying it violates the Vienna Convention. Trade talks continue at a low level and expectations for a broader deal have dropped.
- The Australian dollar is on the rise after the country's Unemployment Rate surprisingly dropped to 5.2%. The nation gained 14,700 positions in September.
- Oil prices have been under pressure after a private survey showed a build in inventories. WTI Crude trades below $53.
- Cryptocurrencies are on the back foot with Bitcoin trading just below $8,000.
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