Dollar lower, equities higher on positive trade comments
Scott Petruska, CFA | November 15, 2019
Positive comments by Trump advisers on the progress with US-China ‘Phase 1’ trade negotiations is pushing global equities higher. The dollar index edged lower, but ended the week slightly higher. Bond yields moved higher.
November 15, 2019
EUR/USD 1.1045 GBP/USD 1.2908 USD/CAD 1.3233 AUD/USD 0.6806 USD/JPY 108.66 USD/CNH 7.0045 USD/ILS 3.4713 USD/MXN 19.2050 USD/CHF 0.9896 USD/INR 71.79
The dollar edged lower overnight. Positive trade comments fueled a slight risk-on mood, pushing the dollar lower. The Scandi currencies were the best performers of the majors.GBP
The UK pound whipped around overnight within a 20 pip range and is virtually unchanged from yesterday’s close. It benefited the least of all the major currencies overnight from the risk-on sentiment in the markets. Traders focus on yesterday’s weak UK Consumer Sales data, as households may finally be giving in to Brexit uncertainty.EURAlthough down on the week, the euro is finishing on a positive note. Trading is characterized by low volatility within a tight range. Traders await next week’s EZ manufacturing data, which will help determine if Europe is heading towards a recovery given some recent positive signals. German bund yields trade at -0.33%, much higher than August’s lows at -0.72%.CAD
The Canadian dollar reversed early gains to end virtually unchanged. For the week, the loonie has lost about 0.50% versus the US dollar and is one of the weakest of the G-10 currencies. BOC Governor Stephen Poloz’s latest speech failed to provide hints as to further monetary policy easing, as he gave a more optimistic outlook for wage growth.ASIA/PACIFIC
The USD/CNY currency pair is trading just over 7/USD and is on track for its first weekly gain for nearly two months. Traders are showing frustration with ongoing trade uncertainty and China’s decelerating economy.
The Japanese yen weakened overnight, as the positive trade comments depressed its safe-haven status.