Friday's trading sentiment was initially slightly risk-off. European equities and the euro held a downward bias during a mainly technical driven trading session. Risk climate turned for the better as the US joined however. Markets took comfort in a few headlines by trade negotiators suggesting the US and China "made headway". All looks set to sign the phase 1 deal at the APEC summit in November. EMU stocks reversed intraday losses, US equities headed north. The SP 500 even set a new record high. The dollar outperformed on FX markets. EUR/USD slipped below 1.11 (1.108), USD/JPY inched higher towards 108.67.

Asian markets begin the week on decent footing in the wake of WS's fresh alltime highs. China outperforms amid trade optimism. USD/CNY declines to 7.06. In Argentina, current president Macri conceded losing the elections to opposition candidate Fernandez over the weekend. The central bank already announced tighter capital controls in the vote's aftermath. USD/ARS stopped short of closing at another record high last Friday. EUR/USD is marginally grinding higher close to but below 1.11., but struggles not to fall below 1.11. USD/JPY is holding in the 108.70 area. Yen investors are looking forward to this week's BoJ meeting.

Today's economic calendar contains only secondary data and does no justice to what will be an important week. US investors brace for the Fed, the manufacturing sector's ISM and the payrolls report. Q3 GDP growth figures are due in the EMU and the US. The backloaded agenda might keep investors sidelined for today though. EUR/USD technical picture didn't alter dramatically even after slipping below 1.11 – but holding well above 1.10. Brexit uncertainty hasn't been removed (yet?), capping the pair's upward potential. At the same time, the dollar probably won't make much headway ahead of the Fed meeting. This should give EUR/USD some downside protection.

Sterling reversed Friday's intraday losses mainly on a U-turn in sentiment. EUR/GBP closed marginally lower near 0.864 even as France voiced opposition to a three-month delay in Brexit. This morning's headlines however suggest that Macron caved in after all. The EU's draft proposal would now postpone the deadline until January 31 with the option to leave on November 30 or December 31 if both sides ratify the deal earlier. EUR/GBP barely moves, confirming our view that sterling discounted quite some positive news already. Focus now turns to early elections: will Johnson's call now get the support it needs?

Download The Full Sunrise Market Commentary Currencies

This non-exhaustive information is based on short-term forecasts for expected developments on the financial markets. KBC Bank cannot guarantee that these forecasts will materialize and cannot be held liable in any way for direct or consequential loss arising from any use of this document or its content. The document is not intended as personalized investment advice and does not constitute a recommendation to buy, sell or hold investments described herein. Although information has been obtained from and is based upon sources KBC believes to be reliable, KBC does not guarantee the accuracy of this information, which may be incomplete or condensed. All opinions and estimates constitute a KBC judgment as of the data of the report and are subject to change without notice.

Analysis feed

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!

Latest Forex Analysis

Editors’ Picks

EUR/USD pressured around 1.13 after jump in US jobs

EUR/USD is trading around 1.13, down after US Non-Farm Payrolls shocked with a leap of 2.5 million jobs in May, contrary to all projections. The greenback is gaining while stocks are falling, a correlation breakdown. ECB stimulus previously supported the euro.


GBP/USD retreats from highs

GBP/USD is trading below 1.27, off the highs. The pound is struggling after Chief EU Negotiator Barnier reported little progress in Brexit talks. Robust US jobs support the dollar.


Gold sees weekly closing below $1700 - a caution for bulls

The steady decline in Gold prices (futures on Comex) accelerated on Friday, as the rates closed the week below the 1700 mark for the first time in three weeks at 1688.35. A weekly closing below the key 1700 level is unlikely to bode well for the bulls.

Gold News

Institutional demand exceeds Bitcoins supply

Greyscale floods the market with fresh money to satisfy the demand of its clients. Investors, willing to pay a 29% surcharge for exposure to Bitcoin without suffering the legal and operational inconveniences. Market remains at risk on the verge of new bullish territory.

Read more

WTI rallies above $39 as focus shifts to OPEC+ meeting

Crude oil prices built on Thursday's modest gains and rose sharply on Friday boosted by the upbeat market mood optimism surrounding Saturday's OPEC+ meeting. 

Oil News

Forex Majors