Forex Today: Huawei limits weigh on sentiment as Trump wants a weaker dollar, UK GDP and Canadian jobs eyed
|Here is what you need to know on Friday, August 9th:
- The market mood is mixed after the US is moving forward to limit Huawei – the Chinese telecom giant in retaliation for China's halting of buying US agricultural goods. On the other hand, Beijing fixed the yuan lower but above expectations, providing some calm. China's Producer Price Index has disappointed with a drop of 0.3%, indicating industrial weakness.
- Markets are still digesting President Donald Trump's desire to see a weaker dollar. US producer prices are of interest today.
- Japanese GDP rose by 0.4% in the preliminary read for the second quarter, better than expected. USD/JPY is stable.
- AUD/USD: Reserve Bank of Australia Governor Phillip Lowe has said that a lower exchange rate helps the Australian economy but also added that New Zealand's large rate cut has no implications for Australia. AUD/USD is holding above 0.68.
- Italy: PM Giuseppe Conte and deputy PM Matteo Salvini are at loggerheads over the existence of the government. Conte would like to prolong the coalition while Salvini aims for elections.
- UK: Uncertainty about elections weighs on the pound. November 1st – a day after Brexit – is considered as an election date. Some suspect the government would like to bypass government to force a no-deal exit. Preliminary GDP for the second quarter is due out today.
- Oil prices have stabilized at lower ground and helped USD/CAD find its footing around 1.3200. Canada's jobs report is key for the loonie today.
- Cryptocurrencies are slightly lower with Bitcoin trading below $12,000.
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