Tuesday October 29th, 2019

Risk-oriented currencies strengthened on Tuesday as hopes for an easing in Sino-U.S. trade tensions buoyed sentiment. U.S. President Donald Trump said a trade agreement looked to be ahead of schedule on Monday, without detailing the timing. Washington also said it was studying whether to extend tariff suspensions due to expire in December. Today we get the U.S Consumer Confidence index which is predicted to rise to 127.4 in October from 125.1 in September.

The CAD strengthened to its highest in more than three months against the USD yesterday after investors boosted bullish bets on the currency and ahead of an interest rate decision tomorrow. With inflation staying close to its 2% target and robust job growth, it is expected Bank of Canada will hold a “neutral hold” decision tomorrow.

EUR trading below 1.1100 against the USD this morning. EUR/USD will be headline driven with no major data scheduled as we await the release of French GDP and German inflation on the 30th.

Sterling fell towards a 10-day low on Tuesday, nearing $1.28 against a broadly stronger greenback after British Prime Minister Boris Johnson failed to gain the majority backing in parliament he required for an election, the third time he has failed to do so. Johnson is now looking try once again, by a different legislative route that would only require a simple majority, rather than a two-thirds majority.