Daily Update - 6th November 2018
The greenback traded with mixed strength through the daily sessions, ending the day mostly lower across the board. Majors, however, traded within familiar levels, as the week will be fulfilled with first-tier events starting this Tuesday with the US Mid-term elections. During the London session, on a report suggesting that the EU Commission could impose sanctions on Italy over the budget of this last The GBP/USD pair gapped higher at the weekly opening amid mounting speculation of a possible Brexit deal to be out this week. Headlines and comments from authorities involved in the negotiations were out all throughout the day, with some even suggesting Brexit Secretary Raab could resign, quickly denied. The only fact by the end of the day is that the Irish border issue is still unsolved and that the run against the ticking bomb of a no-deal Brexit is coming to an end without a winner RBA Interest Rate Decision is announced by the Reserve Bank of Australia. If the RBA is hawkish about the inflationary outlook of the economy and rises the interest rates it is positive. For the EUR, economic data scheduled for release is on the heavier side, with the U.S mid-term elections taking centre stage, the Italian coalition government continues to stand strong against the European Commission on the rejected budget proposal. Italy has until 13th November to deliver a revised budget and, with Italy’s debt already downgraded by Moody’s, rising borrowing costs, ballooning debt, a high unemployment rate and a slowing economy spells trouble, not just for Italy but for the Eurozone and the EUR. For the Pound, while the numbers were on the positive side, providing support to the Pound, Brexit continues to be the key driver, the recent upward momentum coming off the back of hopes of a deal at the final hour. With the Irish Prime Minister looking to lay down the law on the Irish border issue and with Theresa May scheduled to update her cabinet on where things stand later today, it may not be all plane sailing for the Pound. Across the Pond, with economic data limited to September’s JOLTs job openings, we can expect the Dollar to be in the hands of the mid-term elections, with weakness coming in anticipation of the Democrats taking over the House of Representatives, which would bring to an end the U.S President’s free reign on policy and the Obama reversal plan.Yesterday’s Focus
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