Uncertainty regarding Brexit timing weighs on the pound and euro to close out the week
Kathryn Garvey " | October 25, 2019
The pound and euro are under pressure as uncertainty regarding Brexit timing and soft manufacturing numbers out of the Eurozone weighs on the currencies. Economic calendars are light today and markets await next week’s FOMC meeting for fresh direction.
October 25, 2019
EUR/USD 1.1097 GBP/USD 1.2817 USD/CAD 1.3063 AUD/USD 0.6825 USD/JPY 108.60 USD/CNH 7.0678 USD/ILS 3.5344 USD/MXN 19.0910 USD/CHF 0.9932 USD/INR 70.8887
The dollar is trading slightly higher to close out the week. The economic calendar is quiet with U. of Mich. Sentiment due out mid-morning. Next week’s FOMC meeting will provide another look at how the U.S. central bank sees the economy. Right now, futures pricing suggests an 89% chance of another interest rate cut.GBP
The pound slid lower this morning as Brexit timing uncertainty persisted in the market. The EU will discuss the possibility of another delay beyond the October 31st deadline as PM Johnson seeks a snap election to form a majority government. It is unclear when then decision on the extension may come.EUR
The euro followed the pound lower and slid back from recent highs. Manufacturing numbers yesterday showed the sector shrank for the ninth straight month. Mario Draghi passed over control of the ECB to former IMF leader Christine Lagarde who will inherit a group of weakened economies, central bankers at odds with one another, and negative interest rates.CAD
The Canadian dollar gained strength and is heading towards a weekly gain of 0.4% versus the U.S. Dollar. Traders have ruled out a rate cut next week and anticipate the BoC to leave rates unchanged at 1.75%.ASIA/PACIFIC
U.S. and Chinese trade officials are set to speak today to discuss plans on the specifics for Phase 1 of a trade deal between the U.S. and China. China will buy more farm good in return for the US cancelling planned and existing tariffs on Chinese imports.