Tria: EU forecasts of Italy deficit inaccurate and incomplete

    Italian Economy Minister Giovanni Tria complained that the new budget deficit forecasts for Italy by European Commission released today. The Commission projected Italy’s deficit to hit 2.9% of GDP in 2019. Even worse, Italy’s deficit is projected to hit 3.1% in 2020, breaking EU’s 3% limit. This is much higher than Italy’s own target of 2.4% in 2019.

    Tria said “the European Commission’s forecasts for the Italian deficit are in sharp contrast to those of the Italian government and derive from an inaccurate and incomplete analysis.” Though, Tria also said that the projections would not affect the “continuation of constructive dialogue” with the Commission. And, the coalition government is committed to the 2.4% deficit target.

    UK Hunt: Brexit negotiation in final stage but seven days is probably pushing it

      UK Foreign Minister Jeremy Hunt said in Paris today that Brexit negotiation is in a “final stage”. Regarding EU, he said “I am confident that we will reach an agreement because it is in all sides interest to reach an agreement.” However, he also emphasized that “seven days is probably pushing it”, referring to question whether the agreement could be done within seven days.

      Domestically, Hunt said “we are confident that we will be able to get a final deal through parliament for the simple reason that Theresa May is not going to sign up to a deal that is inconsistent with the letter and spirit of the referendum.”

      European update: Selloffs in EUR/GBP and EUR/AUD starting to spillover

        Dollar is trading to regain some ground in European session as markets await FOMC rate decision later today. Though, It’s Australian Dollar which is the strongest one for today so far. Canadian Dollar follows as the second strongest. On the other other hand, European majors are generally lower. There isn’t any special trigger for the weakest for Sterling. The Pound is just starting to feel tired after this week’s strong rally. And, there is no Brexit-positive news to give it another lift. For Euro, it seems the selloffs in EUR/GBP and EUR/AUD are starting to spillover.

        In other markets, European stocks are mixed at the time of writing.

        • FTSE is up 0.32%
        • DAX is down -0.17%
        • CAC is down -0.03%
        • German 10 year yield is up 0.011 at 0.462
        • Italian 10 year yield is up 0.054 at 3.396

        Earlier in Asia:

        • Nikkei closed up 1.82% at 22486.92
        • Hong Kong HSI rose 0.31% to 26227.72
        • Singapore Strait Times rose 0.91% to 3093.24
        • But China Shanghai SSE dropped -0.22% to 2635.63

        Eurozone 2019 growth forecasts lowered, inflation to dive to only 1.6% in 2020

          The European Commission lowered 2019 Eurozone growth forecast by 0.1% to 1.9%, then slow to 1.7% in 2020. HICP inflation forecast for both 2018 and 2019 are raised by 0.1% to 1.8%. However, HICP inflation is projected to slow down to 1.6% in 2020.

          In the release European Commission warned that “rising global uncertainty, international trade tensions and higher oil prices will have a dampening effect on growth in Europe”. And looking ahead “the drivers of growth are set to become increasingly domestic”.

          There are two interesting points to note. Firstly, inflation is forecast to move away from ECB’s 2% target in 2020, reflecting further slowdown in activity. Does that mean ECB shouldn’t raise interest rates in 2019? Secondly, Italy’s budget deficit is projected at -2.9% of GDP in 2019, way higher than its government’s own target of -2.4%. In 2020, Italy’s deficit is even projected to exceed EU’s limit of -3%.

          This is a quick summary:

          GDP growth at

          • 2.1% in 2018 vs 2.1% (Summer) vs 2.3% (Spring)
          • 1.9% in 2019 vs 2.0% (Summer) vs 2.0% (Spring)
          • 1.7% in 2020

          HICP inflation at

          • 1.8% in 2018 vs 1.7% (Summer) vs 1.5% (Spring)
          • 1.8% in 2019 vs 1.7% (Summer) 1.6% (Spring)
          • 1.6% in 2020

          And, the full table by country:

          Full release.

          ECB: Ongoing broad-based expansion to continue, markets revised up interest rate expectations

            ECB’s monthly bulletin paints an upbeat picture on the Eurozone economy. In short, even though incoming information was “somewhat weaker than expected”, they remains consistent with “ongoing broad-based economic expansion”. The expansion is supported by ” domestic demand and continued improvements in the labour market.  Risks are “broadly balanced”.

            On prices, measures of underlying inflation “remained generally muted but stand above earlier lows”. At the same time “Supply chain price pressures for non-energy industrial goods in the HICP continued to increase.” “Wage growth developments point to increasing domestic cost pressures.”

            Also, ECB noted that the EONIA forward curve shifted slightly upwards over the review period. And, that indicates “market participants revised up their interest rate expectations for longer horizons.”

            Here are some highlights of ECB monthly bulletin:

            External environment

            • Global survey indicators of economic growth have weakened recently as the global economic cycle matures.
            • Risks to the global economy remain to the downside, amid ongoing actions and threats regarding trade tariff increases by the United States and possible retaliation by the affected countries.
            • Global financial conditions remain supportive for advanced economies, while creating headwinds for emerging market economies.
            • The global trade momentum has moderated, but the near-term outlook remains steady.
            • Global inflation was stable in August.
            • Oil markets have been mainly affected by factors related to the US sanctions against Iran.

            Financial developments

            • Euro area government bond yields have risen since mid-September.
            • Broad indices of euro area equity prices declined.
            • Yield spreads on bonds issued by euro area NFCs remained relatively insulated from tensions in sovereign debt and equity markets.
            • The EONIA forward curve shifted slightly upwards over the review period. Market participants revised up their interest rate expectations for longer horizons.

            Economic activity

            • Incoming information, while somewhat weaker than expected, remains overall consistent with ongoing broad-based economic expansion.
            • Looking ahead, short-term indicators point to continued strength in the labour market in the coming quarters.
            • Household income continued to support growth in private consumption.
            • Private consumption is expected to display resilient growth in the coming quarters.
            • Following the weak first quarter of 2018, investment growth rebounded in the second quarter.
            • Investment is expected to continue to grow solidly, supported by robust domestic demand and favourable financing conditions.
            • Euro area trade growth remained moderate at the beginning of the third quarter of 2018.
            • Overall, the latest economic indicators suggest ongoing broad–based growth.
            • The economic expansion is supported by domestic demand and continued improvements in the labour market.
            • The risks surrounding the euro area growth outlook are assessed as broadly balanced.

            Prices and costs

            • Euro area annual HICP inflation was 2.1% in September, up from 2.0% in August.
            • Measures of underlying inflation have remained generally muted but stand above earlier lows.
            • Supply chain price pressures for non-energy industrial goods in the HICP continued to increase.
            • Wage growth developments point to increasing domestic cost pressures.
            • Both market and survey-based measures of longer-term inflation expectations have remained stable.

            Full ECB monthly bulletin here.

            China-US trade shrank sharply in October, exports down -8.5%, imports down -12.9%

              Trade data from China showed sharp decline in trade between the US and China in October, clearly a result of tariffs. To highlight, exports to US dropped -8.5% mom. Imports from US dropped even more by -12.9% mom. One might argue that imports from EU also dropped -12.5% mom. Admittedly, that could be a warning sign of slowdown in the Chinese economy. But over the year, imports from EU did rose 12.3% yoy.

              In USD term, exports rose 15.6% yoy in October to USD 217.3B. Imports rose 21.4% yoy to USD 183.2B. Trade surplus widened to USD 34.0B, below expectation of USD 36.3B.

              In CNY terms, exports rose 20.1% to CNY 1490B. Imports rose 26.3% to 1257B. Trade surplus widened to CNY 234B, above expectation of CNY 209B.

              With EU in October:

              • Total trade dropped -8.8% mom, rose 13.7% yoy to USD 56.7B.
              • Exports to EU dropped -6.4% mom, up 14.6% yoy to USD 35.0B
              • Imports from EU dropped -12.5% mom, up 12.3% yoy to USD 21.6B
              • Trade surplus rose 5.3% mom, 18.5% yoy to USD 13.4B

              With EU from January to October

              • Total trade rose 12.8% yoy to USD 563.6B
              • Exports to EU rose 11.8% yoy to USD 336.7B
              • Imports from EU rose 14.3% yoy to USD 226.8B
              • Trade surplus rose 7.0% yoy to USD 109.9B

              With US in October

              • Total trade dropped -9.4% mom, rose 9.8% yoy to USD 53.7B
              • Exports to US dropped -8.5% mom, up 13.2% yoy to USD 42.7B
              • Imports from US dropped -12.9% mom, down -1.8% yoy to USD 10.9B
              • Trade surplus rose 19.4% to USD 31.8B

              With US from January to October

              • Total trade rose 11.8% yoy to USD 526.1B
              • Exports to US rose 13.1% yoy to USD 392.1B
              • Imports from US rose 8.2% yoy to USD 134.0B
              • Total trade surplus rose 15.8% yoy to USD 258.1B

              China trade surplus widened to USD 34B in October, both import and export rose

                From China, exports rose 15.6% yoy in October to USD 217.3B. Imports rose 21.4% yoy to USD 183.2B. Trade surplus widened to USD 34.0B, below expectation of USD 36.3B.

                In CNY terms, exports rose 20.1% to CNY 1490B. Imports rose 26.3% to 1257B. Trade surplus widened to CNY 234B, above expectation of CNY 209B.

                 

                UK RICS house price balance dropped to six year low, never-ending Brexit negotiation a key drag

                  UK RICS house price balance dropped to -10 in October, down from -2. That’s also the weakest reading since September 2012. RICS noted that “The weaker trend in prices is being driven by the lack of demand from new buyers, which is in part a result of heightened political uncertainty, ongoing affordability pressures, a modest upward move in interest rates and a lack of fresh stock coming onto the market.”

                  RICS Chief Economist Simon Rubinsohn also noted that “uncertainty about the economic outlook on the back of the never-ending Brexit negotiations appears a key drag on sentiment according to respondents to the survey.”

                  BoJ: Recent fall in stocks reflects effect of US-China trade frictions

                    BoJ released the summary of opinions at October 30/31 monetary policy meeting today. There the central reiterated that the economy is “likely to continue expanding”. It noted “positive momentum in domestic demand”. The September Tankan survey also “reconfirmed enterprises’ strong fixed investment stance”.

                    However, momentum of the expansion “weakened somewhat” recently due to natural disaster and US-China trade conflicts. BoJ also pointed out that recent stock prices fall “large for external demand-oriented firms” and “small for domestic demand-oriented firms”. Therefore, “the fall in stock prices certainly seems to reflect the effects of the trade friction to some extent.”

                    On inflation, BoJ maintained that CPI is “likely to continue accelerating moderately” but the developments have been “weak and unstable”. And, “rise in inflation has been delayed with a positive output gap” as inflation mechanism is becoming “complex”.

                    On monetary policy, BoJ noted “t is important to consider in a flexible manner such factors as the range of yield movement and the target maturity of JGBs in conducting yield curve control, while maintaining the framework of monetary easing.” This suggested policymakers are considering further tweak to the current framework.

                    Full summary of opinions.

                    RBNZ Orr refuses to rule out rate cut, but NZD stays firm

                      New Zealand Dollar stays firm after RBNZ left OCR unchanged at 1.75% as widely expected. In the accompanying statement, RBNZ maintained the intention to keep OCR unchanged “through 2019 and into 2020”.

                      The language that the “the direction of our next OCR move could be up or down” was removed. Instead, RBNZ said “there are both upside and downside risks to our growth and inflation projections. As always, the timing and direction of any future OCR move remains data dependent.”. That at first glance looked like the central bank is moving away from the possibility of a cut. However, Governor Adrian Orr made it clear in the press conference that “it would be pointless to remove that option”, regarding a cut.

                      Orr also talked down the pick-up in GDP growth in the June quarter as “partly due to temporary factors”. Instead, he pointed to businesses surveys which “suggest growth will be soft in the near term”. While employment is “around its “maximum sustainable level”, core inflation remains below 2% target mid-point, “necessitating continued supportive monetary policy”.

                      Below are the press conference video and full statement.

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                      Official Cash Rate Unchanged at 1.75 Percent

                      Tena koutou katoa, welcome all.

                      The Official Cash Rate (OCR) remains at 1.75 percent. We expect to keep the OCR at this level through 2019 and into 2020.

                      There are both upside and downside risks to our growth and inflation projections. As always, the timing and direction of any future OCR move remains data dependent.

                      The pick-up in GDP growth in the June quarter was partly due to temporary factors, and business surveys continue to suggest growth will be soft in the near term. Employment is around its maximum sustainable level. However, core consumer price inflation remains below our 2 percent target mid-point, necessitating continued supportive monetary policy.

                      GDP growth is expected to pick up over 2019. Monetary stimulus and population growth underpin household spending and business investment. Government spending on infrastructure and housing also supports domestic demand. The level of the New Zealand dollar exchange rate will support export earnings.

                      As capacity pressures build, core consumer price inflation is expected to rise to around the mid-point of our target range at 2 percent.

                      Downside risks to the growth outlook remain. Weak business sentiment could weigh on growth for longer. Trade tensions remain in some major economies, raising the risk that trade barriers increase and undermine global growth.

                      Upside risks to the inflation outlook also exist. Higher fuel prices are boosting near-term headline inflation. We will look through this volatility as appropriate. Our projection assumes firms have limited pass through of higher costs into generalised consumer prices, and that longer-term inflation expectations remain anchored at our target.

                      We will keep the OCR at an expansionary level for a considerable period to contribute to maximising sustainable employment, and maintaining low and stable inflation.

                      Meitaki, thanks.

                      Today’s top mover: NZD/USD at key resistance zone just ahead of RBNZ statement

                        NZD/USD is the top mover for today so far, up 0.80% at the time of writing. On the one hand, Dollar is broadly sold off after US mid-term elections. On the other hand, strong employment data came in at an ideal time, just before RBNZ rate decision in the upcoming Asian session.

                        RBNZ is widely expected to keep the Official Cash Rate unchanged at 1.75%. And, the central was very clear in its last statement that it intend to keep OCR at this level “through 2019 and into 2020”. More importantly, RBNZ said “the direction of our next OCR move could be up or down.”. There has been some bets that the next move is a cut. The question is, with unemployment rate hitting decade low at 3.9%, and employment rate jumped to record at 68.3%, would RBNZ turn less dovish? We’ll see within a couple of hours.

                        Technically, NZD/USD is now at a very important resistance zone. That is, 38.2% retracement of 0.7436 to 0.6424 at 0.6811, which is close to 0.6779 support turned resistance. Decisive break there will solidify the case of bullish medium term reversal. And further rally should at least be seen to 61.8% retracement at 0.7049 and above. This is our preferred case for now as long as 0.6689 minor support holds.

                        However, break of 0.6689 will indicate rejection by this key 0.6779/6811 resistance zone. That will revive medium term bearishness and could bring retest of 0.6424 low as next step.

                        European update: Dollar overwhelmingly weak on elections, Australian Dollar strongest

                          Dollar is overwhelmingly the weakest one today. Democrats have already won over 218 seats in House in the mid-term election to regain majority after eight years. Republicans, on the other hand, retained majority in Senate. There are talks that the gridlock in the Congress would limit Trump’s ability to push through more fiscal stimulus. Yet, there is another theory that the stocks markets were usually bullish with a split Congress. DOW futures are now pointing to higher open with triple digit gains. Major European indices are generally higher. So it seems that the latter is more true. And thus, a split Congress is unlikely the reason for Dollar’s weakness. Staying in the currency markets, Canadian Dollar is now the second weakest, followed by Japanese Yen. On the other hand, Australian Dollar is the strongest one, followed by New Zealand Dollar and then Swiss Franc.

                          In Europe, at the time of writing:

                          • FTSE is up 1.17%
                          • DAX is up 1.03%
                          • CAC is up 1.36%
                          • German 10 year yield is up 0.015 at 0.452
                          • Italian 10 year yield is down -0.076 at 3.330

                          Earlier in Asia

                          • Nikkei dropped -0.28% to close at 22085.80
                          • Hong Kong HSI rose 0.1% to 26147.69
                          • China Shanghai SSE dropped -0.68% to 2641.34
                          • Singapore Strait Times rose 0.1% to 3065.36

                          Irish PM Varadkar hints at no Brexit deal within November

                            Irish Prime Minister Leo Varadkar said today that ” with every day that passes, the possibility of having a special summit in November becomes less likely.” He referred to the extra EU summit for Brexit and hinted that it’s unlikely to reach a deal that soon.

                            Though, Varadkar also noted “we do have one scheduled for the 13th, 14th of December, so not getting it done in November doesn’t mean we can’t get it done in the first two weeks of December. But I think beyond that you’re into the New Year, which I think wouldn’t be a good thing.”

                            German Foreign Minister Maas: A misconception to bet on course corrections from Trump after mid-term

                              More from EU on US mid-term elections:

                              German Foreign Minister Heiko Maas tweeted, “It would be a misconception to now bet on course corrections from Donald . It remains the case: The US remains our most important partner outside Europe. To maintain this partnership, we need to re-measure and realign our relationship with the US.”

                              Also, “More diverse, younger, more feminine-these are the winners of the, especially among the democrats. A good part of the electorate has thus confirmed the pioneering role that the country still plays, and hopefully in the future, in favour of diversity and freedoms.”

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                              EU Moscovici: Trump is right, tremendous success tonight

                                Here are some comments from two EU officials on US mid-term elections.

                                European Commission First Vice President Frans Timmermans, “Inspired by voters in the US who chose hope over fear, civility over rudeness, inclusion over racism, equality over discrimination. They stood up for their values. And so will we.”

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                                European Commissioner for Economic and Financial Affairs Pierre Moscovici, “The Democrats won the House of Representatives for the first time in eight years, despite a mighty Republican Gerrymandering. Donald Trump is right: “Tremendous success Tonight”

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                                SNB Zurbruegg: Exchange rate situation still very fragile, current monetary policy has to continue

                                  SNB Vice Chairman Fritz Zurbruegg said in a Schaffhauser Nachrichten newspaper interview that when EUR/CHF was at 1.2, there came the ” the impression that everything is solved and the pressure is gone – the franc is no longer a safe haven”. However, then, “you can see that the franc reacts very quickly as long as there are uncertainties.” That showed the “exchange rate situation is still very fragile”. Therefore, SNB policymakers are “convinced we have to continue with our current monetary policy.”

                                  Also, he noted the central bank is not considering to reduce its balance sheet yet. He said “there are risks that we have accepted to fight against the over-valuation of the franc, and we can live with that. And, “the size of our balance sheet doesn’t limit our ability to act and we have shown that we are still ready to intervene in the currency markets if necessary.” He added “that’s why there is no talk at present about reducing this portfolio.”

                                  Dollar broadly lower as Democrats tipped to gain House majority

                                    Dollar trades broadly lower as US mid-term election results are coming in. The Republicans are set to retain control of the Senate as widely expected. Meanwhile, according to Fox News projections, Democrats would take over the majority in House. The question now is, how big the majority would it be.

                                    Meanwhile, Trump tweeted “Tremendous success tonight. Thank you to all!”. It’s unsure what success he’s referring to. Would it be Democrat’s win in House?

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                                    UK PM May denied childish document on plan to announce Brexit deal on Nov 19

                                      BBC reported, based on a “leaked” document titled “Brexit Communications Grid Summary” that UK Brexit Minister Dominic Raab is set to announce the full withdrawal agreement on November 19 and put to parliament. And, according to the document, the Parliament would vote on the bill on November 27.

                                      But Prime Minister Theresa May’s spokesman quickly came out and denied it. The spokesman said “The misspelling and childish language in this document should be enough to make clear it doesn’t represent the government’s thinking. You would expect the government to have plans for all situations – to be clear, this isn’t one of them.”

                                      For your entertainment, here is the full text of the notes:

                                      Brexit Communications Grid Summary

                                      Cabinet reviews the deal this Tuesday, the 6th November. They expect all the details to then leak.

                                      “A moment of decisive progress” will be announced this Thursday. Raab to announce.

                                      The narrative is going to be measured success, that this is good for everyone, but won’t be all champagne corks popping.

                                      Then there’s recess until 12th.

                                      After the announcement of decisive progress there follows the 10 days of Sherpa meetings with EU 27 and then daily themed announcements.

                                      19th November – “We have delivered on the referendum” PM speaks at the CBI conference.

                                      Saying this deal brings the country back together, now is the time for us all to unite behind it for the good of all our futures etc. She will also hold a business reception.

                                      This is the day both the Withdrawal Agreement and Future Framework will be put to Parliament by way of a statement from Raab who will also do media. Junior ministers are doing regional media all day. Government lining up 25 top business voices including Carolyn Fairburn and lots of world leaders eg Japanese PM to tweet support for the deal.

                                      20th – Theme is Delivering for the Whole of the UK – PM to visit the north and or Scotland and the Commons will debate in business motions the date of the Meaningful Vote.

                                      PM will be back in the house to vote. The Cabinet Office publishes its explainer of the deal and what it means for the public, comparing it to No Deal, but not to our current deal.

                                      Other business leaders to come out and back it eg Adam Marshall from Chambers of Commerce and supportive voices in devolved regions like Andy Street and Andy Burnham. Also hoping to get 3rd Sector voices out supporting it.

                                      21st – Theme is Economy, Jobs, Customs. Philip Hammond to open debate in Commons and Raab to close it. Institute of Directors to speak out.

                                      Hoping for Stephen Martin, Martin McTeague etc

                                      22nd – Theme is immigration – take back control of our borders. Home Sec doing media and visits. Raab on QT in the West mids.

                                      Hope Mike Hawes of SMMT will speak out in favour along with influential voices from the rest of the world saying how great this is for the flow of global talent.

                                      23rd – Theme is money – NHS funding and structural funds. Matt Hancock hospital visit. David Everett to welcome the deal alongside Tech for UK.

                                      24th Theme is Northern Ireland and The Union – no hard border in the UK and the integrity of the Union is protected. PM visits border communities and business in NI and maybe also to Wales to visit agri and export businesses. Karen Bradley doing media.

                                      Trying to get Varadker to support and Anand Menon and Henry Newman too.

                                      25th – Theme is global Britain. We can strike trade deals with RoW (rest of world) security in this one too.

                                      Speech from Liam Fox. Jeremy Hunt on Marr. Hope Miles Celic to come out in support (City UK).

                                      Lining up lots of former foreign secs to come out in support and Mark Littlewood of the IEA.

                                      26th – theme is taking back control of our laws, Raab doing media. PM interview with Dimbleby.

                                      27th – morning theme is agri and fisheries. Gove doing a visit and media.

                                      Evening is the vote. HISTORIC MOMENT, PUT YOUR OWN INTERESTS ASIDE, PUT THE COUNTRY’S INTERESTS FIRST AND BACK THIS DEAL.

                                      NZD surges after surprisingly strong New Zealand job data

                                        New Zealand Dollar surges broadly after surprisingly strong employment data. Unemployment rate dropped -0.5% to 3.9% in Q3 versus expectation of 4.4%. That’s the lowest level in a decade since June 2008. Employment rate rose 0.5% to 68.3%, highest since the series began 30 years ago. Participation rate also rose 0.2% during the quarter to 71.1%. Employment grew 1.1% qoq versus expectation of 0.5% qoq.

                                        The set of strong data came in just a day ahead of RBNZ rate decision. RBNZ is widely expected to keep OCR unchanged at 1.75%, without a doubt. The tone of the accompanying statement is the key. RBNZ Governor Adrian Orr has sounded rather dovish in his recent comments, even being open for a cut as next move. The upbeat data will likely be reflected in the communications and thus, at least, remove some bets on RBNZ cut.

                                        Recent rally in NZD/USD is in line with the case of bullish trend reversal. This is supported by the strong break of 55 day EMA, bullish convergence condition in daily MACD and current upside acceleration. Focus is now on 38.2% retracement of 0.7436 to 0.6424 at 0.6811, which is close to 0.6779 support turned resistance. Decisive break of this resistance zone will confirm reversal and target 61.8% retracement at 0.7049 and above. However, rejection from 0.6779/6811, followed by break of 0.6610 support will revive bearishness and bring retest of 0.6424 low.

                                        Today’s top movers: GBP/JPY and GBP/CAD

                                          GBP/JPY and GBP/CAD are the two biggest movers today, thanks to broad based strength in the pound. Nonetheless, considering that they’re up 72 pips and 68 pips only, it’s indeed a very slow day.

                                          For GBP/JPY, rise from 147.26 is in progress for 1349.70 resistance. Our views as discussed in the daily report is unchanged.

                                           

                                          GBP/CAD’s rebound from 1.6643 accelerates higher today and reaches 1.7183 so far. Further rise is likely for 1.7285 resistance. However, for now, we’re viewing price actions from 1.6594 as forming a corrective pattern. That is, rise from 1.6643 is merely a leg inside the pattern. Hence, we’d expect strong resistance from 38.2% retracement of 1.8415 to 1.6594 at 1.7290 to limit upside. Break of 1.6980 minor support should bring retest of 1.6594 low.

                                          Firm break of 1.7290 fibonacci level could bring stronger rebound to 61.8% retracement at 1.7719. But, we’ll still treat it as part of the correction from 1.6594 unless we see more evidence of trend reversal, in terms of price structure. The down trend from 1.8415 is still expected to resume, just at a later stage.