Markets kicked-off the week on a cheerful note, with the risk-on sentiment dominating across the financial markets, despite several mixed weekend headlines from the central bankers. Friday’s strong Chinese exports data, upbeat US banks earnings and renewed US-China trade optimism boosted the appetite for risk assets at the expense of the safe havens Gold, Japanese Yen and US dollar.
USD/JPY consolidated near five-week tops reached at 112.10, while from the European currencies, Pound bounced to 1.31 handle despite ongoing Brexit uncertainty and EUR/USD held onto minor bids above the 1.1300 level amid broad USD weakness and mixed Treasury yields.
The European session remains a thin-showing amid a lack of first-tier macro releases. Hence, markets will continue to track the broader market sentiment and USD dynamics for near-term trading impetus.
In the NA session, speeches by the BOE MPC member Haskel and FOMC member Evans will grab some attention later today.
Oil prices is on the rounds near $63.50 during the early session on Monday, as it couldn’t extend its previous upside as comments from Russian Finance Minister and IMF question buyers. During the weekend, Reuters reported that Russia’s Finance Minister said that Russia and OPEC may decide to boost production to fight for market share with the United States. However, the Russian Finance Minister spotted fears of oil prices sliding to as low as $40 as a catalyst that offers the dilemma.
Gold prices slipped on Monday in Asia and traded well below the key $1,300 level as the release of stronger-than-expected China trade and credit data on Friday continued to bolster risk appetite. The better-than-expected data eased concerns about a global economic growth slowdown and provided support to stocks and other risk assets. Despite the recent risk-on sentiment, IMF continues to highlight downside risks to the global economy. Also, trade talks between the US and China are heads toward the currency manipulation points, a tough thing to discuss for both the economies.