You are here: Home > articles > Forex > US Open Preview – Pound shrugs off stronger retail sales as Brexit talks resume
US Open Preview – Pound shrugs off stronger retail sales as Brexit talks resume
August 16, 2018 11:25 amVideo
Latest News
- Trading Signals for EUR/USD for May 3-5, 2024: sell below 1.0803 (overbought – 5/8 Murray) May 3, 2024
- Trading Signals for GOLD for May 3-5, 2024: sell below $2,320 or below $2,300 (21 SMA – 200 EMA) May 3, 2024
- Technical Analysis – GBPUSD advances above descending trendline May 3, 2024
- USD experiences day X May 3, 2024
- Bitcoin licks wounds as Fed comes on the rescue – Crypto News May 3, 2024
- GBP/USD: trading plan for the US session on May 3rd (analysis of morning deals). The pound is preparing to get out of the May 3, 2024
- EUR and GBP may drop May 3, 2024
- EUR/USD: trading plan for the US session on May 3rd (analysis of morning deals). US data will be the key moment of the week May 3, 2024
- USD/JPY: Simple trading tips for novice traders for May 3rd (US session) May 3, 2024
- GBP/USD: Simple trading tips for novice traders for May 3rd (US session) May 3, 2024
- Video market update for May 03, 2024 May 3, 2024
- EUR/USD: Simple trading tips for novice traders on May 3rd (US session) May 3, 2024
- Could the BoE adopt a more dovish stance on Thursday? – Preview May 3, 2024
- EUR/USD. May 3rd. Bulls don’t give up without a fight May 3, 2024
- GBP/USD. May 3rd. Bears are counting on a strong US labor market May 3, 2024
- Market Comment – Stocks enjoy Fed-induced bounce as dollar slips ahead of NFP May 3, 2024
- Weekly Forex Outlook: 03/05/2024 – BoE and RBA decisions headline a calm week May 3, 2024
- Week Ahead – BoE and RBA decisions headline a calm week May 3, 2024
- USD/JPY: trading tips for beginners for European session on May 3 May 3, 2024
- GBP/USD: trading tips for beginners for European session on May 3 May 3, 2024
Here are the latest developments in global markets:
Day ahead: Brexit talks resume, with trade developments also in the spotlight
The highlight of the remainder of Thursday’s calendar will likely be the resumption of the Brexit negotiations in Brussels, and any potential comments from the relevant officials. Any developments on the trade front or the situation in Turkey will also be closely watched.
After some relatively encouraging UK data releases this week, which despite confirming that the economy remains on a healthy track still failed to lift the British pound, investors’ attention now turns back to Brexit. Markets will look out for any signs of progress in the negotiations, or the lack thereof. Note that the pound has recorded significant losses lately amid speculation that a no-deal Brexit is becoming more likely and hence, the Brexit risk-premium on the currency is probably quite high already. This suggests the risks surrounding the pound from these talks may now be somewhat asymmetrical, and tilted to the upside. Whereas more lack of progress could keep the currency at current low levels or even trigger some further moderate losses, any hints that the negotiations are set to move forward may come as a positive surprise and thereby, lead to an outsized relief bounce.
Turning to trade, overnight news suggest China will send a delegation to the US in late August to hold another round of negotiations aimed at resolving the trade dispute between them. The headlines supported risk sentiment earlier on Thursday, lifting the euro – which had been hurt by trade woes in recent months – and weighing on the yen as well as on the dollar that have been attracting safe-haven flows lately. Any comments by the two sides that set the stage for what to expect from these talks could well impact risk appetite again. Anything pointing to a negotiated solution becoming more likely could benefit risk-sensitive currencies like the aussie to the detriment of havens like the yen, and vice versa.
The situation in Turkey will also remain on investors’ radars. The lira staged a notable comeback in recent days, aided by some technical adjustments by the central bank. That said, the diplomatic showdown with the US over the release of pastor Brunson remains in full swing, while the broader macroeconomic picture has not improved in a meaningful manner, which suggests risks are still present.
In terms of economic data, housing figures out of the US at 1230 GMT may attract attention. Both building permits and housing starts are forecast to have risen in July. Meanwhile, the Philly Fed business activity index for August, which will be released at the same time, is projected to decline. In Canada, manufacturing sales for June – due out at 1230 GMT as well – are anticipated to have risen again, albeit at a slower pace than previously.
In equities, Walmart and Nvidia will release quarterly earnings on Thursday; the former before the US market open, and the latter after the closing bell.
Related Posts: