Tuesday July 23 2019

US$ at a 2 week high versus major currencies as investors have been scaling back expectations of a 50 bps rate cut next week. Yesterday U.S congress reached a deal yesterday on a two year extension of the debt limit, removing fears of a government default later in the year. The US will release the May Housing Price Index, Existing Home Sales for June today.

C$ closed above 1.31 yesterday for the first time in over a week. Canadian wholesale sales disappointed with a -1.8 percent drop when the forecast called for a 0.8 percent gain.

EUR  trading at a 7 week low nearing 1.1180 today as markets reassess the Fed’s interest rate policy ahead of Thursdays ECB decision.  Data this week will likely be overshadowed by the central bank’s decision. The EU will publish the preliminary estimate of July’s Consumer confidence, seen unchanged at -7.2.

GBP fell for the third straight day dragged down by a firmer dollar and concerns a new Prime Minister will pull out of the European union.  Shortly the Conservative party will elect the new Prime Minister and investors will be watching closely to see how many ministers unhappy with a Johnson government will resign as well as the make up of the cabinet.  A win from Boris Johnson as the new Prime Minister will likely add to Brexit related uncertainty.