Asian shares were struggling to avoid a ninth straight session of losses on Tuesday as the spectre of a further escalation in the Sino-U.S. trade war haunted investors, while the pound perched at a five-week top on hints a Brexit deal might be nearer. Having warned last week that he was ready to levy additional taxes on practically all Chinese imports, U.S. President Donald Trump was uncharacteristically quiet on trade on Monday. China has cautioned it will respond if the United States takes any new steps on trade. Canadian Foreign Minister Chrystia Freeland will meet the U.S. Trade Representative in Washington on Tuesday for another round of talks to renew the NAFTA trade pact. While we will expect the numbers to provide some direction for the Pound, the stats skewed to the negative, Brexit chatter will continue to be the key driver, with comments from the EU’s chief negotiator Barnier of a possible deal within the next 8-weeks providing strong support at the start of the week.
In In currency markets, sterling stood out after the European Union’s top negotiator said an agreement for Britain to leave the economic bloc might be reached in the coming weeks. The pound has been under pressure on anxiety that Britain would exit from the EU without any formal trading arrangement. GBPUSD clambered up to $1.3032, after firming 0.8 percent overnight. EURUSD held at 1.1586, hemmed between support at $1.1524 and resistance at $1.1659.
In commodities, U.S. WTI and Brent crude oil futures are edging higher, after a late session sell-off on Monday led to the markets giving back their earlier gains. Prices are being supported by looming U.S. sanctions against Iran’s petroleum industry. However, prices are being capped by signs that increased supplies by other major producers, including the United States and Saudi Arabia, could make up for the disruptions from Iran. Brent was 25 cents firmer at 77.62 a barrel, while U.S. crude inched up 10 cents to 67.64.