The market mood in Monday’s trading was buoyed by the renewed optimism over the US-China trade deal signing, especially after the US Treasury Secretary Mnuchin said that China’s trade commitment with the US was unchanged in the translation.
The anti-risk yen was on the back foot amid Japanese holiday-thinned trades and a better risk environment, as the Asian equities clocked fresh 19-month highs. Therefore, USD/JPY advanced in a bid to challenge the key 109.70 resistance. Markets shrugged off the latest Iranian rockets attack news that injured a few Iraqi servicemen at the airbases that housed the US troops in Iraq.
The pound was the biggest loser so far today, in the face of increasing calls for a Bank of England (BOE) rate cut by the bank’s policymakers and ahead of key UK economic releases.
Meanwhile, EUR/USD kept the bid tone intact around 1.1125 levels amid weak US NFP data-led broad US dollar weakness.
Among other related markets, oil prices steadied near multi-week troughs, with WTI around $59 handle. Gold prices posted small losses below $1555 despite negative Treasury yields, as the risk-on tone curbed the demand for the safe-haven.
Markets brace for a busy start to a big week ahead, as the US-China phase one trade deal signing will remain in the spotlight amidst critical economic release from the US as well as from China.
Next of note remains the UK data dump dropping in at 09:30 GMT. The UK data includes the monthly GDP growth figures, trade balance, industrial and manufacturing production data.
Looking ahead, the US docket is data empty and hence, traders will keep an eye on any updates on the US-China trade front for some momentum to the markets.