The currency markets remain stable as investors wait for Brexit and Sino/US trade agreement next steps. The weak German PMI data appeared to be ignored as the markets focused on interest rate decisions in Europe. A trio of central banks announce rate decisions today, with Sweden raising rates and Norway remained unchanged. ECB will announce its decision later this morning. The focus will then switch to the Fed meeting next week for the direction of US Interest rates. A flurry of US data out this morning including durable goods and initial jobless claims which could impact US$ direction today.
The C$ continues to hold within a tight trading range. The recent fluctuations of oil prices have not significantly impacted the C$. Focus remains on Sino/US trade and the upcoming FOMC rate decision, a cut in US rates should see C$ strengthen vs US$. Intraday we will watch the US data results for direction.
Euro traded in a relatively tight trading range so far today as stronger French PMI data offset the weaker German PMI data. This is the last meeting for Draghi as president of the ECB, Lagarde will take over the presidency in November. Brexit remains a key focus for Euro and will impact its direction as the saga unfolds.
The GBP has been relatively steady considering the political uncertainty over Brexit. UK awaits the EU’s decision on the requested Brexit extension. The markets will watch for the UK PM decision to continue to pass the Brexit legislation or proceed with elections.