Most major traded in thin trading ranges, amid a typical pre-US Non-Farm Payrolls (NFP) lull. The risk-on sentiment extended into Asia amid fading US-Iran war risks and US-China trade deal optimism.
US President Trump confirmed that the phase one trade deal will be signed on January 15th or the agreement could be signed shortly after. The US dollar index showed little reaction to Trump’s comments and consolidated the previous gains to multi-day tops.
EUR/USD hovered above the 1.11 level, GBP/USD recovered some ground after the UK PM Johnson’s Brexit bill was cleared by the UK House of Commons, while the anti-risk yen stood resilient despite a better market mood, keeping USD/JPY side-lined around 109.50 region.
On commodities’ front, oil prices remained under pressure near four-week lows while gold prices also traded on the back foot below $1550.
Markets gear up for the all-important US Non-Farm Payrolls data due later in the NA session at 13:30 GMT that will set the direction for the greenback in the coming weeks.
Ahead of the US jobs data, there are no significant economic releases from the European calendar while the UK politics-related headlines surrounding Brexit combined with any developments on the US-China trade deal and Mid-East crisis should offer some incentives to the traders.
Finally, oil markets will watch out for the Baker Hughes US Oil Rig Count dropping in at 18:00 GMT.