The US stock market got a boost yesterday after it was announced that the health care bill will be voted on next Wednesday along with positive talk by Treasury Secretary Mnuchin, who stated that the US is close to bringing forward major tax reforms along with rumors that President Trump will be signing 2-financially related executive orders this Friday.
In FX, the USD remained steady with the USD index, a measure of the strength of the USD against a basket of currencies, remaining just under the 100 level. The biggest loser against the USD was the EUR which suffered losses after a terrorist attack in Paris which led to the death of a police man. The attack comes days ahead of the upcoming first of round of elections in the country. Elsewhere, the JPY weekend across the board as risk on sentiment return to markets while the NZD reversed its strong gains from earlier in the week after a worse than expected ANZ Consumer Confidence data.
In commodities, crude oil continues to trade at its recent lows with bears challenging the $50.50 support level. Crude is expected to remain weak as various OPEC members begin to squabble as to the fairness on their respective restrictions on supply output. Markets will remain sensitive to news regarding the supply freeze, with a falling price accompanying comments of a dissolvement of the supply freeze agreement and vice versa if the members can confirm to markets that the freeze will continue.
Today’s upcoming highlights are to be released from the UK, USA and Canada. The UK is set to release it retail Sales m/m figure, expected at -0.3%, aggressively lower than last month’s gains of 1.4%. Canada is set to release the CPI m/m figure, expected at 0.4%, double that of the previous month’s gains. The USA is expected to release the Existing Home Sales figure expected at 5.61M, marginally higher than last month’s 5.48M.
Better than expected releases will see the respective currencies strengthen as markets price in improved economic expectation for the country in question while worse than expected releases will see the respective currencies sold off as markets price in worsening conditions for the country in question.