Tuesday July 30th, 2019

Mixed markets overnight, GBP weakened drastically on concerns of a “No-Deal” Brexit. Other currencies were range-bound as investors focused on the anticipated first rate cut by the Fed in a decade. Fed comments will be listened too closely for clues of more possible interest cuts. China/US started two days of trade talks, expect limited comments today.

C$ holding steady ahead of the Fed announcement. Oil prices remain firm, lower US interest rates and any positive comments from China/US trade talks could all bode well for C$.

Eur remains under pressure vs the US$, sitting at 2 year lows. Outlook for EUR remains bearish despite a possible lower US interest rates. Weakening economy, Brexit and political uncertainties continue to keep pressure on EUR in the short term.

GBP hit two year lows vs Eur and Yen overnight as investors started to price in the impact of a “No-Deal” Brexit. Speculation that the conservatives may call a snap election is adding to investors concerns. Expect GBP volatility to remain and look for GBP downward pressure to continue.