Bank of England shows worry, China-U.S. make agreement
NOVEMBER 07, 2019
The U.S. Dollar remains in familiar figures following positive news on the trade front as China announced that it agreed with the U.S. to gradually take back tariffs on their products as they work on a deal.
Indeed, the announcement allows for investors to abolish their fears of further escalation to a conflict that has made a negative impact on forecasts and dented some sectors, particularly agriculture. At the moment, the buck is slowly depreciating against its peers as global stocks look to climb on renewed risk-appetite.
No major data other than the always consistent Jobless Claims today will have us looking for other details on the agreement with China. Already oil and other commodities are looking to benefit in price gains from the headline. Additionally, better than expected European numbers are aiding a narrative of recovery and stability. We shall see how long it lasts, but in FX it has produced little to no movement across the board.
What to Watch Today…
- No major events scheduled for today.
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The Euro has not advanced, but rather has maintained itself from falling too much when negative news hit the wire. Now that the China-U.S. trade front looks more amicable and less stressful, the shared currency could see better fortunes if its economic indicators keep trucking along. Germany’s data continues to seek improvement as October’s Construction Purchasing Managers Index grew at a faster pace than in September.
The Pound is the biggest and only mover today after the Bank of England’s governor Mark Carney made statements that turned what many expected to be a hawkish meeting into a dovish one. The bank maintained its interest rate at 0.75%, but officials showed concern over Brexit and an ongoing slack in the rest of the world.
They mentioned that global downside risks remain as well as the uncertainty businesses have dealt with over Brexit preparations and political infighting. Naturally, Sterling is down by over 0.7% this morning.