Forex Today: US-China trade jitters back in play, focus on Draghi, Brexit news
|Risk-off sentiment seeped back into Asia this Friday, as concerns over the US-China trade issue resurfaced amid the resumption of the high-level talks between the US and Chinese officials. As a result, the safe-havens such as the Yen caught a fresh bid-wave, dragging the USD/JPY pair lower towards the overnight low of 113.10 while risk currency, the Aussie, slipped towards the 0.7250 level while the Kiwi stood resilient near 0.6840 region, although largely range bound. Both the EUR and the pound benefited from broad-based US dollar softness, staging a corrective upside after yesterday’s Brexit blues-led massive slump.
Amongst commodities, gold prices on Comex traded modestly flat near 1215, with the technical setup pointing to further gains while both crude benchmarks staged a comeback following the reports that the US imposed sanctions on Saudi Arabia, in light of the Khashoggi killing.
Main Topics in Asia
Tory-DUP deal over unless PM May replaced - UK's Daily Telegraph
US Trade Rep Lighthizer denies conveying tariff delay on talks
Japan's Aso: Exports affected by trade issues
US imposes trade sanctions on Saudi Arabian officials - Reuters
Senior US official: China offer unlikely to spur major trade breakthrough
China Envoy to US: US is one of China's most important partners
US State Dept on N. Korea tests: Confident that promises between Trump-Kim will be fulfilled
Trump and Xi unlikely to make a full deal, but both willing - Bloomberg
Key Focus Ahead
Today’s EUR macro calendar is a thin showing, with no first-tier economic releases on the docket as market gear up for the ECB President Draghi’s speech due at 0830 GMT. Draghi is due to speak at the Frankfurt European Banking Congress. Meanwhile, the final reading of the Eurozone CPI figures will be due at 1000 GMT. Also, in focus will be ECB Vice-President Weidmann’s speech at 1300 GMT ahead of the Canadian manufacturing sales data that will drop in at 1330 GMT. The US docket holds a slew of macro updates, with the industrial production and Kansas Fed manufacturing activity of note. At 1800 GMT, Baker Hughes US oil rig count data will be reported and is expected to have a significant impact on the oil markets.
EUR/USD: Back above 200-week MA ahead of Draghi speech
A move higher to 1.14, however, depends on what the European Central Bank (ECB) President Draghi says during the keynote speech at the Frankfurt European Banking Congress, scheduled at 08:30 GMT.
GBP/USD: Political headlines leave a Brexit-sized hole
The economic calendar for the UK side remains painfully empty for Friday, leaving the GBP exposed to the full force of Brexit headlines for the day's session, with only Industrial Production for the US trading window at 14:15 GMT.
What no-confidence vote means for Brexit and Pound?
The Prime Minister Theresa May is in a crossfire in both her own Cabinet and in the UK parliament as she is trying to advocate the position of freshly agreed Brexit agreement.
How UK's Brexit Troubles Affect Rest of the World
The UK's troubles extend far beyond Britain's borders. A disorderly Brexit benefits no one including the Eurozone. On a day when currencies such as the Australian and New Zealand dollars are up sharply …
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