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By xemarketanalysis February 19, 2019 11:56 am
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    XE Market Analysis: Sterling Holds Steady on Positive Labour Market Data

    OVERVIEW

    • GBP is climbing towards $1.30 today after UK labour market data showed earnings growth numbers which are the strongest they've been since 2008. 
    • Big week for central bank announcements this week with Fed minutes out tomorrow, Bank of Canada Governor Stephen Poloz to give a speech Thursday, RBA Governor Philip Lowe speaks in Australian Thursday, and ECB President Mario Draghi will step up to the podium Friday. 
    • The forces of weaker oil demand, US sanctions on Iran and Venezuela, and OPEC production supply controls continue to buffet crude prices. 

    HIGHLIGHT

    UK Prime Minister Theresa May is headed back to the EU again to try and pressure EU leaders on the Northern Ireland backstop. Last week, the British parliament voted against the Brexit deal on the table. Brexit Secretary Stephen Barclay and Attorney General Geoffery Cox were in Brussels ahead of May, talking to EU Chief Negotiator Michael Barnier. 

    US DOLLAR

    The US-China trade talks continue today, which is a quiet day for financial data. We'll be watching for minutes from the Federal Reserve, as talks of incremental interest rate increases have eased back of late. The Fed will release the minutes at 2 pm EST Wednesday. In the meantime, the greenback is holding steady against most of its peer currencies. 

    BRITISH POUND

    Though the contentious Irish backstop factor seems to be insurmountable, GBP is at one-month highs relative to the USD, and now sits at $1.30310. The possibility of a disorderly Brexit hovers over the latest talks in Brussels between May and her colleagues and EU leaders.  

    EURO

    There are few data announcements out of the EU this week in the leadup to ECB President Mario Draghi's speech on Friday. Interviews with key ECB executives speak of a weakening in Eurozone economies, however, we will wait until Friday's announcements for more specifics. 

    CANADIAN DOLLAR

    The Bank of Canada speech on Thursday following the release of the Fed meeting minutes. There are no significant data releases today, and the USD CAD pair is slightly higher. WTI prices are also up over $56.70, a three-month high. 

    AUSTRALIAN DOLLAR

    The Aussie is up to 0.71471 against the greenback, climbing from a low of 0.71049. US-China trade talks will continue to dictate the fate of the AUD, which relies on China for many exports.  

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