The Big Picture – Its all about Brexit
Last week was saw a number of FOMC members taking a dovish stance on further interest rate increases, the minutes of the last meeting mirrored this stance. The focus here on in is on manufacturing growth. We have more speakers this week plus the G20 meeting on Thursday and Friday. The dollar may have stopped the current expansion cycle but the question remains have the other countries/ community got more going for them as otherwise we could be see range based trading for some time.
Of course the talk around the begging of the week is regarding Brexit. At present it might appear that the market is buying the pound on the basis on the signals sent that a hard Brexit will not be allowed. Further offers to expand the time to agree the terms seem to be mooted and letters confirming that any backstop will be temporary have been exchanged. If PM May manages to get the agreement passed it would be seen as a positive surprise, anything else is effectively priced in although nervous traders may cause some volatility.
Elsewhere the AUD, CAD and NZD have all benefited from the dollars demise for now at least. Fundamentally only the CAD may see gains if the price oil continues to go up.
The summary sheet I use can be found here
Have a great week,