UK PM Boris Johnson will suspend parliament for 5 weeks in the lead up to Oct 31 Brexit deadline
Laurence Hayward " | August 29, 2019
Pound volatility will rise as driven by news from the UK that parliament will be out. Individual members will take advantage of the lapse to make their own voices heard. The Chinese appear to be trying to dampen the rhetoric on trade tariffs with the US.
August 29, 2019
EUR/USD 1.1065 GBP/USD 1.2196 USD/CAD 1.3297 AUD/USD 0.6740 USD/JPY 106.39 USD/CNH 7.1428 USD/ILS 3.5291 USD/MXN 20.1049 USD/CHF 0.9841 USD/INR 71.7762
The dollar continues it’s slow strengthening, helping the Dow yesterday which rose 258 points. There was some optimism on trade talks with China after the Trade Minister said they will not put new tariffs on the US in place immediately. The US yield curve inverted with the 10 year yield falling below the 2 year. Some pundits view this as a pre-cursor to a recession.GBP
Boris Johnson said he will suspend parliament for over 5 weeks before the Brexit deadline. Parliament will be closed between mid-September and mid-October. This will be the longest suspension since 1945. The house speaker John Bercow said it was obvious this would limit parliament’s ability to discuss Brexit. This could lead to a vote of no confidence and a general election. The pound slumped on the news and was trading down this morning.EUR
The euro weakened against the US dollar due to dollar strength. Christine Lagarde said the ECB has not hit its low on interest rates yet.CAD
The Canadian dollar strengthened after direct investment rose to its highest level in 4 years and WTI oil climbed back above $56 a barrel.ASIA/PACIFIC
The Chinese Yuan is trading above 7 as weakness persists following its worst month in history falling about 4%. Other Asian currencies also look very soft due to the trade dispute with China. The aussie is holding in its recent range and the New Zealand dollar is weaker again.