Thursday August 22nd, 2019

Focus remains squarely on Jackson Hole and the Fed Chair speech on Friday, with investors looking for clarity on the Feds rate stance. Currency markets relatively remained range bound, the US$ has eased slightly heading into Fridays Fed speech. On going US/China trade concerns was reflected in the CNY, which hit fresh 11 year lows in Asia today. Data out in the US today could impact intraday activity, but expect markets to remain within current ranges ahead of the Fed speech tomorrow.

Despite a steady CPI number and stronger oil prices C$ failed to make much headway vs US$, sitting at the mid point of its range. Retail sales tomorrow could give some fresh incentive to C$, but a retest of 1.3350 remains strong.

Positive news for EUR with strong PMI data lead by service industry and manufacturing contracting less than expected. In Italy the expectation is a new government will be formed soon. Focus will be on ECB monetary policy meeting report today and Fed speech tomorrow.

UK PM left Germany, “Merkel hinted at a possible path out of the Brexit impasse by telling Johnson to come up with some alternatives within 30 days.” UK PM visiting French President today who’s tone appears to be a lot less accommodating. UK retail sales plunged at the fastest pace since Dec08, raising questions about its strength heading into Brexit. G7 this weekend, 71 days to Brexit and expect GBP to remain vulnerable to market swings.