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By xemarketanalysis January 30, 2019 2:09 pm
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    XE Market Analysis: Sterling Rises Higher as PM May Hopes to Win Over EU Leaders

    OVERVIEW

    • British PM Theresa May to head to Brussels to press EU leaders on Brexit separation deal amendments. Hope springs eternal that no-deal Brexit remains unlikely.  
    • There are better-than-expected job gains and expectations the Fed will leave interest rates alone out of their meetings this week. These sentiments are lifting the greenback in today's trading. 
    • Japanese retail numbers rise, but consumer confidence sinks lower, taking JPY with it. 

    HIGHLIGHT

    Write the highlight of the article hereAll eyes are on the US Fed meetings happening this week and on US-China trade talks. The 'Ayes' were on sending UK PM Theresa May back to Brussels to attempt to convince EU leaders to amend parts of the Brexit deal. Contentious points included the backstop on Northern Ireland, while the amendment to extend Brexit past March 29th was voted down. 

    US DOLLAR

    The tense, ongoing trade talks between the US and China are getting tenser, as the DOJ files criminal charges against Chinese telecommunications giant Huawei. Despite this tension, the USD has held firm against the euro and the pound, following ADP non-farm job gains of about 213,000, beating the 185,000 forecast. USD/EUR closed at 0.87569.

     

    BRITISH POUND

    PM Theresa May and her parliamentary colleagues are optimistic she can get EU leaders to bend on some terms, and they can eke out a deal before  March 29th. This optimism seems to be propping up sterling against the euro. GBP closed at 1.143 after touching a high of 1.151. 

    EURO

    U Chief Negotiator Michel Barnier said he and the European leaders stand behind the agreement which they negotiated with PM May. There seems to be no appetite for amendments. German consumer confidence reports were stronger than expected. January Eurozone consumer confidence, however, sunk from 107 in December to 106.2 for January. 

    CANADIAN DOLLAR

    Canadian GDP numbers from are due out tomorrow, and there is an expectation of an economic contraction of 0.1%, blamed on the sharp decline of crude oil prices. USD/CAD closed at 1.32.

    AUSTRALIAN DOLLAR

    US-China trade talks started anew today, which continues to weigh on AU and AZ currencies. The AUD rose on the back of higher than expected inflation of 1.8%, and the CPI index increase by 0.5%. Tobacco, food, and recreation saw the highest price increases. 

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