US dollarSafe-haven Japanese Yen caught some bids in early trade on Monday in reaction to media reports that China wants the scope of this week’s trade talks and any deal with the United States to be narrow. The impact, so far, has been limited ahead of the resumption of the US-China trade talks later this week.
On the other hand, the US Dollar remained on the defensive amid growing speculations that the Fed will cut interest rates again at its upcoming policy meeting on October 29-30 in order to support the economy.
Friday’s mixed US monthly jobs report did little to influence market expectations, albeit a modest uptick in the US Treasury bond yields helped limit any deeper losses.
On the Brexit related front, The Telegraph reported that the UK PM Boris Johnson would veto the EU’s seven-year budget and send a Eurosceptic commissioner to Brussels to “disrupt” the bloc’s workings if he were forced into a Brexit delay.
Against the backdrop of Friday’s Brexit-related headlines, wherein the European parliament president was reported to have rejected Johnson’s new Brexit proposal, the latest development might continue to weigh on the British Pound.
A quiet morning on the scheduled data slate, however, there are headlines to watch out for on US-China trade talks scheduled for the end of the week and EU/UK Brexit headlines for GBP movement moving closer to, or further away from a deal.
In the American afternoon, the Fed Chair Powell will make another public appearance today, but he will likely refrain from commenting on monetary policy.
Oil prices have failed to recover after the massive sell-off last week and WTI remains below $53. The yellow metal, gold, is relatively flat at the start of this week with both Australia and China out on holidays with the price is back above the psychological $1,500.