Forex news for North American trade on August 29, 2018
- Barnier: We are prepared to offer Britain partnership unlike with any other country
- NAFTA: Canada's Freeland says encouraged by progress so far
- US Q2 GDP (second reading) +4.2% vs +4.0% expected
- US July pending home sales -0.7% vs +0.3% m/m expected
- Canada current account balance for 2Q -C$15.88B vs -C$15.3B est.
- Mexico's steel lobby is not happy about the new NAFTA deal
- Pana-Nieto: Believes en route to a trilateral NAFTA accord
- Trump says optimistic Canada will join US-Mexico trade deal
- Senior Iraqi official: OPEC should discuss how to make up for drop in Iran oil supply
- US sells seven-year notes at a high yield of 2.844%
- Mexico says it has side letter on autos exemption for 232 tariffs
- NAFTA: Canada's Freeland says had another productive talk with USTR
- Trump: White House lawyer Don McGahn to leave
- EIA weekly crude oil inventories -2566K vs -1487K expected
- Di Maio says Italy not asking for help from anyone
- Raab says he's confident a Brexit deal is "within our sights"
Markets:
- Gold up $5 to $1206
- S&P 500 up 17 points to 2914
- US 10-year yields up 0.5 bps to 2.88%
- Argentine peso falls 7.4%
- GBP leads, JPY and AUD lag
It looked like it might be a sleepy day but another record in stocks lifted USD/JPY close to a four week high. The big story though was in the pound as it roared higher after Barnier said the EU was prepared to offer the UK a deal unlike any other, it was off to the races as cable climbed to 1.3026 from 1.2870 and looks to finishing at the highs.
USD/CAD also erased an earlier climb on the combination of higher oil prices (+$1.17 for WTI) and upbeat comments on NAFTA from the US, Canada and Mexico. From 1.2955 early in Toronto trade, the pair slipped down to 1.2907.
Economic data wasn't a big market mover but was part of the story for USD/JPY strength. The pending home sales weakness raised some eyebrows but that didn't add up to much.
As for AUD, Westpac raised rates 14 bps on benchmark mortgages and the fear is that other domestic banks will follow. In turn, that makes it more likely the RBA will cut rates, especially with house prices under some pressure. AUD/USD fell as low as 0.7275 but has battled back to 0.7307, down a third-of-a-cent on the day.
The euro was in the eye of the storm and didn't do much. It's rounding out the day up 10 pips at 1.1705.
