Daily Market Update

Italian and Brexit Progress Put Dollar Under Pressure

November 26, 2018

After rallying on Black Friday, the U.S. dollar is slightly softer to start Cyber Monday.

Overview

The greenback is weaker across the board as geopolitical progress was made with both Italy’s budget crisis and Brexit.

World equities are also trading in the green today, limiting demand for the greenback as a safe-haven.

This week’s economic docket will prove to be very busy but only the Chicago and Dallas Fed prints are slated for release this morning. Things pick up tomorrow with Consumer confidence and S&P CoreLogic housing prices. New Home Sales, Richmond Fed, personal consumption and GDP will cross the wire on a busy Wednesday. The Fed’s favorite inflation reading the PCE Deflator, pending home sales and personal income and spending are all out on Thursday morning. In the afternoon, the Federal Reserve will release the minutes of their last monetary policy meeting. The Chicago Purchasing Managers index will finish up the week on Friday.

 

What to Watch Today…

  • Chicago and Dallas Fed

The complete economic calendar can be found here.

 

EUR

The Euro has been on the offensive in early trading on speculation that Italy may seek a compromise with the European Union over their budget plans. Italian Deputy Prime Minister Matteo Salvini told AdnKronos newswire that the goal of a 2.4% deficit-to-GDP shortfall could be adjusted. 2.4% would be in break of the EU rules. In what could be viewed as an orchestrated move, Salvini’s economic advisor Armando Siri said that “a little fine-tuning of the budget” is possible.

The economic docket was not as rosy as a report showed that German business confidence disappointed and has limited the Euro’s gains.

GBP

The British pound initially popped higher overnight but has been unable to hold on to much of its gains. News broke over the weekend that Prime Minister Theresa May was able to get the European Union to agree to a deal for Brexit. She now faces the tall order pass the deal through Parliament. She will attempt to sell the deal to lawmakers by saying “there is not a better deal available.” May intends to hold a Parliamentary vote on the Brexit deal on December 12th, according to the Telegraph.

 

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