Brexit vote this afternoon remains top of mind
Kathryn Garvey " | October 22, 2019
The dollar is mixed versus G-10 peers but is outperforming the pound, euro and loonie. A second vote on the UK withdrawal agreement is set for this evening (7pm in the UK) and the uncertainty has driven the pound lower. Canada’s PM Justin Trudeau won their general election but will need to form a coalition government to maintain majority power in Canadian Parliament. Optimistic news out of China on the trade dispute has boosted risk appetite.
October 22, 2019
EUR/USD 1.1134 GBP/USD 1.2914 USD/CAD 1.3105 AUD/USD 0.6860 USD/JPY 108.54 USD/CNH 7.0760 USD/ILS 3.5403 USD/MXN 19.0995 USD/CHF 0.9883 USD/INR 70.94
USDThe dollar is mixed versus G-10 peers but rebounded from 3-month lows ahead of the UK Parliament vote. Existing U.S. home sales and the Richmond Fed manufacturing index are due out at 10am this morning.GBP
Boris Johnson continues his effort to gain support for his Brexit deal in Parliament today after it was initially voted down on Saturday. Today’s vote on the second reading of the general principal of the exit bill is scheduled for 2pm EST. Projections show that Johnson probably has enough support to pass the vote, however it will be immediately followed up by a second motion on the timetable of departure and if an extension is necessary. The pound is slightly lower on the uncertainty.EUR
The euro fell this morning on spillover Brexit uncertainty, falling EU bond yields and a European Commission report warning that five member countries draft budgets for 2020 could break fiscal rules.CAD
PM Justin Trudeau secured a second term yesterday with a minority government. He will likely form a coalition with the New Democratic Party to hold an 11-seat majority in parliament. Market response was muted as the economy performed strongly under his administration. The loonie dropped slightly this morning after a miss on retail sales data. Sales were down .1% in August versus a projected 0.5% gain.ASIA/PACIFIC
Vice Foreign Minister Le Yuchang said that the US and China have achieved some progress in trade talks. The US announced a phase 1 deal with China that would suspend a scheduled tariff hike this month. The yuan strengthened 12 pips versus the dollar.