Daily Market Update

Buck Weakens As Government Back On

January 28, 2019

The U.S. Dollar fell a half percent last week against its G-10 counterparts, mostly the result of a return in risk-appetite across global markets after quite a slow start to the year.

Overview

The dark clouds of Brexit and China-trade uncertainty combined with the longest U.S. government shutdown in history made for a very somber January that witnessed dampened economic activity with airports even feeling the pinch over security concerns that government agencies must carry.

We shall see how things normalize now that the government is back on, but the consequences will be revealed as the week progresses. We shall also look forward to the return of statistical data that can help us paint an outlook and educated opinions. Reportedly, we will see figures we have missed for over a month along with scheduled Gross Domestic Product and Labor readings later this week.

 

What to Watch Today…

  • No major events scheduled for today.

The complete economic calendar can be found here.

 

EUR

The Euro remains vulnerable, but returned to positive territory after a week that mostly cast a shadow on the Euro-zone’s chances of a successful economic future short-term. European Central President Mario Draghi spoke to the EU Parliament’s Economics and Monetary Affairs Committee today answering questions regarding his thoughts on policy.

Lately, EU financial officials and lawmakers have been concerned with stagnation and contractions in different sectors of the continent’s economy such as German, French and Industrial Production. Again, not weighing on the Euro, not yet, perhaps already investors convinced this is a “new normal” for the range.

GBP

The Pound is trading at its strongest levels since mid-October ahead of Tuesday’s Parliamentary vote over Prime Minister Theresa May’s Brexit deal. The separation deal is said to be backed by May’s typical coalition of pro-Brexiteers and Democratic Unionists, but the debate among members is what will be the show to see as they try forging a new way forward by pushing for a second Brexit referendum.

The lawmakers will have the chance to discuss and vote on amendments to May’s “Plan B.” The markets think either a deal will somehow be reached or a referendum will be called upon, thus rewarding Sterling’s value since a “no-deal” scenario seems more unlikely now.

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