It's been a quiet night in FX land with most of the majors contained to 20 pip ranges as currency markets waited for definitive news on the US-China trade conflict

Although Larry Kudlow the director of National Economic council confirmed that tariffs would be rolled back as part of any trade deal, Peter Navarro the assistant to the President noted last night that only Donald Trump had the power to rescind the tariffs on Chinese goods and implied that the President may be reluctant to do so at this time.

The push and pull of negotiations cast a pall on risk trades as markets have essentially decided to tread water until a definitive resolution to the matter is at hand.

Elsewhere the only data point of note today will be the Canadian labor data report at 13:30 GMT. The markets are anticipating a much smaller increase in jobs to 15.9K from 53.7 the month prior. USDCAD has been flirting with the 1.3200 figure ahead of the report and any disappointment could push the pair through that key resistance level very quickly.

Last week the BOC, which is one of the very few G-7 banks that remain in a neutral rather an accommodative mode, hinted that it would be open to rate cut especially if US rates continue to decline. A weaker jobs number would almost assure a policy move at the next meeting in December and could send the cross through 1.3300 by the end of the day.

Author

Boris Schlossberg

BKTraders and Prop Traders Edge

Boris Schlossberg was key speaker at the FXstreet.com International Traders Conferences 2010. Mr. Boris Schlossberg is a leading foreign exchange expert with more than 20 years of financial market experience.

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