Monday September 30th, 2019

US$ remains firm vs the major currencies ahead of Sino/US trade talks and US impeachment inquiry. The U.S. House impeachment inquiry intensifies as witnesses testify on allegations made the Whistleblower. On Trade, Vice Commerce minister said China hopes Beijing & Washington will resolve their trade dispute “with a calm and rational attitude”. China is off this week celebrating 70 years of PRoC, trade talks are scheduled to resume Oct 10/11th. Other currency news, NZD falls to 4 years lows as business confidence tumbles to 11 1/2 year low.

C$ remains firm within its current trading band despite weakening oil prices & general strong US$ tone. Investor confidence remains that BOC will keep rates on hold at the next meeting. The announcement Friday from Alberta that it plans to ease oil curtailments, as well trade talks scheduled in October added to the positive sentiment. Geopolitical risk remains in the Middle-East which may continue to impact Oil prices going forward.

This morning German retail sales rose by 0.5% in August as expected, the market will now focus on European Consumer prices out at 8am EST for direction. Eur remains under pressure, but managing to hold above recent lows. Economic growth for Europe remains weak, geopolitical risk and the ongoing Sino/US trade dispute continue to put pressure on the EUR. The potential of a test of 2017 lows for Eur remains high.

Q2 GDP was upgraded to 1.3% YoY, better than expected which helped GBP rebound from last weeks lows. Political uncertainty remains high in the UK with conservatives affirming their stance for Brexit Oct31. Opposition parties meet again to discuss next steps, which include possibly ousting the UK PM. Expect GBP to remain vulnerable to more volatility. 31 days to Brexit deadline.