Dollar seems to be responding rather well to Trump’s threat to escalation tariff war with China. And, it’s gaining momentum in European session. Nevertheless, reactions in other markets are rather muted. There were some jitters as it’s falsely reported that Trump and Xi agreed a deal but was quickly denied. For now, Australian and New Zealand Dollar are still the strongest ones for today. But both look vulnerable and their places could be taken by Dollar and Yen easily.
Sterling and Euro are the worst performing ones so far. There were rumors that Italy’s 2019 budget target target could finally settle at 2.2% of GDP instead of 2.4%. UK Prime Minister Theresa May issued a TV debate challenge to Labour’s Jeremy Corbyn on Brexit. And Corbyn swiftly accepted. The debate could be held on December 9, just two days ahead of Commons vote on the deal. Eventually, other parties’ representatives may also join. These news provided little support to both currencies.
Technically, GBP/USD’s break of 1.2764 supports suggests decline resumption and focus will be quickly back on 1.2661 low. USD/CHF is now eying 1.0006 minor resistance and break would put 1.0128 resistance back into focus. We’ll see Dollar could sustain its momentum. Or it will be knocked down by Fed Vice Chair Richard Clarida’s comment at 1330 GMT.
In European markets, at the time of writing:
- FTSE is down -0.31%
- DAX is down -0.15%
- CAC is down -0.19%
- German 10-year yield is down -0.0125 at 0.35.
- Italian 10-year yield is up 0.0035 at 3.266. German-Italian spread stays below 300
Earlier in Asia:
- Nikkei gained 0.64%
- Hong Kong HSI dropped -0.17%
- China Shanghai SSE dropped -0.04%
- Singapore Strait Times dropped -0.10%
