Trade war will move the markets once more

Weekly Report - 16/12/2019

Trade Deal to be broken into stages


Following the US and China, Friday's announcement regarding the progress of the trade deal, a crucial point of the agreement "agricultural purchases" continues to be in question. Mutual trade is a vital component of the conflict between the world’s two greatest economies, in particular following the decision by both sides to break the discussions preferably into stages. Last Friday, the US and China took separate press conferences to publish that they joined a so-called phase one contract. Now regarding the farming agreement, the US Trade Representative Robert Lighthizer said China would purchase $16 billion more farming goods in each of the next two years, according to Reuters. Ting Lu, the chief China economist at Nomura, said: “That scale of purchases seems implausible and Chinese officials were reluctant to mention any specific target during their press conference”.

Week that was

Last week the head of the Conservative Party Boris Johnson accomplished as prime minister of the UK a parliamentary majority. With this, he has prepared the route for England to leave the European Union by the end of next month. The prognosticated result proved even more powerful than specialists had determined. It is now anticipated that Boris Johnson will begin planning for England’s departure with the help of an obvious majority of 74 seats.


Main Focus This Week

On Monday Preliminary December private sector PMIs will start the week. Following some limited ISM figures, we suspect some vulnerability to the weak greenback. Tomorrow November industrial production numbers will be in the center before December’s Philly FED Manufacturing PMI that is going to be released on Thursday. At the week, the finalized 3rd quarter GDP, November personal spending, and preliminary December consumer sentiment numbers expected to move the markets as well. October JOLTs job openings on Tuesday and inflation numbers on Friday are expected to have a silenced impact on the greenback.


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