USD - United States Dollar
The Greenback has benefited from the Chinese state media, which is saying that face-to-face trade talks with the U.S. may happen soon as the country has engaged in many positive actions over the weekend. The moves are focused on American farm goods, a topic that President Donald Trump has been very vocal about. Authorities in Beijing also declared they were opening the country’s financial sector to foreign investors further, which is improving the mood in the capital markets in general.
The low volatility in the FX market has been influenced in part by the Fed, which is in a position to cut interest rates this month. However, before the Fed’s first likely cut in a decade, market participants will get a fresh read on the health of the economy based on upcoming releases such as data from new-home sales and durable-goods orders (middle of this week), followed by the first reading of second-quarter economic growth.
In the U.K., economic growth has stalled, and there is around a one-in-four chance that the economy is already in a technical recession. There is a very gloomy outlook beyond October when the U.K. leaves the European Union. The possibility of a severe decline in the event of a chaotic no-deal about Brexit is strong.
It is an earning season in the U.S. from technology to retail, which seems to help the U.S. dollar marginally. The U.S. dollar index is increasing +0.11 percent at the time of this writing, and the global equity markets seem very quiet at this point, with the S&P futures gaining 0.2 percent, the 10-year Treasury yield at 2.04 percent, and gold remaining flat.
The EUR/USD pair trades flat at 1.1220 this morning with the global economy being a source of bad news for the monetary union. The slowdown in global commerce has severely hurt Germany, which is now expected to grow by a mere 0.5 percent in 2019, according to the European Commission. Last month, the ECB had cut its forecasts for euro-zone growth.
1.3050 - 1.3110 ▲EUR/USD:
1.1205 - 1.1255 ▲GBP/USD:
1.2458 - 1.2505 ▼AUD/USD:
0.7023 - 0.7085 ▲NZD/USD:
0.6757 - 0.6800 ▲