Market mood improves on fresh US-China trade optimism after Global Times editor reported China will introduce important measures to ease the negative impact of the trade war. Meanwhile, China released tariffs exemption list for products from the US.
The Yen remains the main straggler at six-week lows near 107.85 against the dollar on trade progress and dovish BOJ expectations. EUR/USD clings to minor gains around 1.1050 amid the recent rally in German bund yields, awaiting Thursday’s ECB monetary policy outcome. The German stimulus talks pushed 30-year bund yields into positive territory. Meanwhile, GBP/USD trades above 1.2350 ahead of an empty UK docket and bi-weekly EU-UK Brexit negotiations.
There are no scheduled events and releases in Euroland today, therefore EU/UK Brexit talks between the British PM and Brussels’ Brexit task force will be keenly observed.
Across the Atlantic, there are no major data/events on the economic calendar either, other than the Producer Prices due at 12:30 GMT. As a result, trade and political headlines will keep being in the spotlight for the market sentiment.
Oil prices jump on large US crude inventory draw, reversing the drop fuelled by speculation of sanctions-hit Iranian crude returning to the market after US President Trump’s fired Iran-policy hawk, Bolton.
Gold holds the lower ground sub-$1,500 but retraces from multi-week low following political headlines. Restricting further declines could be headlines of North Korea’s extended missile tests, despite offering a peace talk to the US, and Iran’s warning to remove the US forces off Afghanistan.