Amid lack of certainty on the US-China trade deal prospects and China’s first Repo rate cut since 2015, the market mood remained cautiously optimistic in Asia, starting out this week on Monday. Moreover, the ongoing Hong Kong civil turmoil also kept the risk tone somewhat fragile. As a result, the Asian equities traded mixed while the weakness in the US Treasury yields left the US dollar broadly undermined.
Most G10 currencies stuck to tight trading ranges, although the Cable emerged the top gainer and headed towards 1.2950 on increased hopes of UK PM Johnson’s re-election. The weakest of all was the Aussie, followed by the anti-risk Japanese yen. AUD/USD pair consolidated the recent recovery above the 0.6800 level while USD/JPY traded with mild gains around 108.80, with the upside capped by the 200-DMA at 109.00. The Kiwi remained modestly flat around the 0.64 handle. Meanwhile, the EUR/USD pair clocked fresh one-week highs at 1.1065. On the other hand, USD/CAD lacked momentum above 1.3200, as oil prices remained flat under the $ 58 mark. Gold prices, however, eased towards $ 1460 on the Chinese rate cut announcement.
Main Topics in Asia
UK election: Poll shows Conservatives hold the top spot – GBP/USD Positive
US Pres. Trump hails 'cash' to farmers, U.S. aid in China trade war – Reuters
China and US had constructive discussions about phase one deal – Xinhua
UK’s Raab: It’s not “remotely likely” that UK could leave without a deal, Cable tested 1.2930
Fed’s Daly: “We can keep the policy rate accommodative”
UK housing market hit by Brexit and election double-whammy - Rightmove survey
11th US-China Political Leaders Dialogue kicks off in Beijing – Global Times
Sources: US to extend license for its companies to continue business with Huawei - Reuters
Senior US Official: Monitoring events in Hong Kong, condemns “unjustified use of force
Asian stocks flash mixed signals amid trade hopes, Hong Kong protests
Key Focus Ahead
We have a quiet start to the relatively calm week ahead, in terms of the macroeconomic releases and hence, the UK political updates and US-China trade developments will remain the central focus.
As for Monday’s EUR calendar, the speeches from the European Central Bank (ECB) policymakers will headline alongside the German Bundesbank (Buba) monthly economic report. The UK docket remains absolutely data-empty while the US session also sees an absence of significant first-tier economic news.
Key ECB-speak ahead
0900 GMT – ECB’s De Guindos
1300 GMT - ECB De Cos
1320 GMT – ECB’s Lane
EUR/USD sits at weekly tops above 1.1050, eyes on ECB-speak, trade
EUR/USD is seen building on its last week’ s recovery above the 1.1050 level, having hit weekly highs at 1.1065 on mild US dollar weakness across the board. The bulls consolidate the latest uptick, awaiting fresh trading impetus heading into the European open.
GBP/USD confronts near-term key resistance amid Brexit optimism
GBP/USD cheers increasing odds of Tory leadership. US-China trade hopes, military tension and Russian meddling in British politics keep the gains in check. UK PM’s speech, US Housing numbers and trade/Brexit headlines will be in focus.
GBP/USD Forecast: All aboard the Boris bus? Downside momentum dims outlook
GBP/USD has been rising alongside the Conservatives' reelection chances. Opinion polls, trade headlines, and further Fed news are set to determine the next cable moves. Mid-November's daily chart is pointing to falling momentum for the pound.
UK PM Johnson will pledge an end to Brexit uncertainty at CBI event later on Monday
Speaking at the Confederation of British Industry’s (CBI) annual conference scheduled later on Monday, the UK PM Johnson is expected to show his commitment to end the Brexit uncertainty that has ‘paralyzed’ the economy.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD remained bid above 0.6500
AUD/USD extended further its bullish performance, advancing for the fourth session in a row on Thursday, although a sustainable breakout of the key 200-day SMA at 0.6526 still remain elusive.
EUR/USD faces a minor resistance near at 1.0750
EUR/USD quickly left behind Wednesday’s small downtick and resumed its uptrend north of 1.0700 the figure, always on the back of the persistent sell-off in the US Dollar ahead of key PCE data on Friday.
Gold holds around $2,330 after dismal US data
Gold fell below $2,320 in the early American session as US yields shot higher after the data showed a significant increase in the US GDP price deflator in Q1. With safe-haven flows dominating the markets, however, XAU/USD reversed its direction and rose above $2,340.
Bitcoin price continues to get rejected from $65K resistance as SEC delays decision on spot BTC ETF options
Bitcoin (BTC) price has markets in disarray, provoking a broader market crash as it slumped to the $62,000 range on Thursday. Meanwhile, reverberations from spot BTC exchange-traded funds (ETFs) continue to influence the market.
US economy: slower growth with stronger inflation
The dollar strengthened, and stocks fell after statistical data from the US. The focus was on the preliminary estimate of GDP for the first quarter. Annualised quarterly growth came in at just 1.6%, down from the 2.5% and 3.4% previously forecast.