You are here: Home > articles > Forex > US Open Preview – Sterling plunges amid worries of no Brexit deal; RBNZ rate announcement pending
US Open Preview – Sterling plunges amid worries of no Brexit deal; RBNZ rate announcement pending
August 8, 2018 12:25 pmVideo
Latest News
- 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
- EUR/USD: trading tips for beginners for European session on May 3 May 3, 2024
- Technical Analysis – WTI futures break below 200 day-SMA May 3, 2024
Here are the latest developments in global markets:
Day ahead: RBNZ announces its rate decision; Trade continue to linger
Wednesday will be quiet in terms of data releases, with the focus turning to New Zealand late in the day, where the Reserve Bank will conclude its policy meeting at 2100 GMT. Analysts are widely expecting policymakers to keep interest rates unchanged at a record low of 1.75%. Recall that at the latest meeting, the central bank signaled that borrowing costs could move both up or down, if necessary. While today a survey showed that RBNZ inflation projections for the next year have increased to an average of 1.86% from 1.8% seen previously and 2-year expectations have risen slightly to 2.04%, policymakers could opt to hold stimulus in place for now amid an uncertain global trade environment. A slowdown in GDP growth in the first quarter could also cause policymakers to refrain from raising rates. Should the central bank put more weight on downside risks, including a potential deterioration in trade conditions due to the US’s rising protectionist appetite, a fact that could dampen hopes for a rate hike in the future, the kiwi could lose ground against the greenback. A press conference is scheduled to follow the rate announcement.
Meanwhile in the US, Trump’s administration continues to pressure China, saying late on Tuesday that it is planning to activate a 25% import tariff on an additional $16 billion Chinese goods in two weeks. But earlier today stats out of China indicated that US import tariffs did not restrict trade activities in July, with both exports and imports rising faster than analysts estimated and China’s wide trade surplus with the US edging slightly lower from $28.97 billion to $28.09bn. On Wednesday at 0130 GMT, China will also see the release of CPI and PPI readings for the month of July, where any surprise in the data could move the Chinese yuan, and perhaps the Australian dollar as well, given the close economic ties between the two nations.
In Canada, loonie traders will pay attention to housing building permits due at 1230 GMT. Forecasts are for the measure to lose strength, posting a growth of 1.0% month-on-month in June after expanding by 4.7% in May. The EIA report on oil inventories delivered at 1430 GMT could also move the loonie. In case US crude stocks have declined more than 3.33 million barrels analysts forecast in the week ending Aug 3, oil prices could increase positive momentum and the commodity-linked loonie could enjoy some gains.
In other data of interest, June’s core machinery orders will be available in Japan at 2350 GMT.
In the Eurozone, fiscal reforms in Italy could keep investors cautious. Government officials will be meeting today to discuss on the budget, which needs to be finalized by the end of September and before the meeting with the rest of the EU leaders in October.
Brexit talks will resume on August 16-17 but any headline giving evidence on the Brexit situation could bring new volatility to the pound.
Related Posts: