Nervousness in China

Daily Analysis - 03/07/2018

Risk sentiment down on trade war fears

chinese-currency-down


The euro recouped the prior day’s losses as German Chancellor Angela Merkel avoided a coalition split. The question is whether Merkel’s deal with her Interior Minister Horst Seehofer is merely a pause and not an end to the infighting in her government.

Euro gains


The euro jumped higher on a relief rally after Angela Merkel managed to avoid a breakup of her coalition government that arose due to her Interior Minister Horst Seehofer disagreeing with a Migration Policy that was struck at the recent EU Summit. Merkel’s deal calls for setting up holding centers at the German border for refugees already registered in other European Union countries. Seehofer seems to have reached a compromise with the Chancellor. EURUSD traded above $1.1650 earlier this morning.

popup_close
eurusdh1dd

Chinese yuan weakest since August 2017


Both the onshore and offshore yuan reached key levels after weakening again today, resulting in the intervention of the Chinese central bank to halt the currency’s fall. The PBOC governor said the bank was closely watching recent fluctuations in FX market caused by a strong US dollar and uncertainties surrounding trade. He reassured markets that China’s financial risks are under control and that the PBOC will keep the CNY stable and at a reasonable level.

popup_close
usdcnh-h1dd

WTI oil edges higher  


Crude oil creeps higher and reached above $73 a barrel. Overnight news that Libya, a large oil producer, has suspended exports from two of its key ports. The ADP inventory report will be closely watched late today.  Other data due today include UK construction PMI and U.S. durable goods orders.

popup_close
cl-aug18-h1dd-2

Upcoming Events

  • Time
  • Currency
  • Event
  • Forecast
  • Previous
  • 8:30 GMT
  • GBP
  • Construction PMI (Jun)
  • 52.5
  • 52.5
  • 9:00 GMT
  • EUR
  • Retail Sales (MoM(May)
  • 0.1%
  • 0.1%
  • 14:00 GMT
  • USD
  • Durable Goods orders (Mom)
  • -0.6%
  • 20:30 GMT
  • USD
  • API Weekly crude oil inventories
  • -9.228m

Risk Warning : CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading CFDs with this provider.
You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money