Ho-hum. With no fresh catalysts to price in, Asian session market traders took cues from their previous sessions’ counterparts.
- CAD pushed higher on NAFTA updates
- Senate confirms Richard Clarida as Fed Vice Chair
Canada ready to play nice with NAFTA friends?
Analysts have been talking about how the U.S.-Mexico bilateral trade deal will affect Canada’s prospects almost as soon as the development was announced.
Markets were hopeful that Canadian Foreign Minister Chrystia Freeland and her team could negotiate a deal instead of falling into a tariff battle with the world’s largest economy.
Well, earlier today Globe and Mail cited “people in government and industry familiar with the deal-making” and hinted that Ottawa is “ready to make concessions.”
Apparently, Canada is willing to provide more access to its dairy market and maybe loosen up its intellectual property rules that would grant stricter protections to pharmaceutical patents.
In return, Canada wants to save NAFTA’s dispute-settlement system that allows countries to challenge each others’ duties at binational trade panels.
But there’s a catch. Washington reportedly wants Freeland and her team to sign a deal by Friday or President Trump could walk away from NAFTA altogether and just work with Mexico. What’s more, the POTUS could also make tariffs rain on Canada’s auto exports.
The U.S. and Canada have three days to work it out, but for now, Globe and Mail’s report is keeping market players optimistic.
Overall risk appetite
There were no fresh catalysts to rock the markets today, so Asian session traders played catch up to the previous sessions’ price action.
If you recall, everyone and his momma were happy that the U.S. and Mexico were able to hammer out a deal. It also didn’t hurt that latest economic data pointed to higher confidence among U.S. consumers.
- Nikkei is up by 0.53% to 22,935.0
- A SX 200 is up by 0.65% to 6,345.8
- Shanghai index is down by 0.35% to 2,768.228
- Hang Seng is up by 0.23% to 28,415.6
Commodity prices also extended their gains, with gold taking advantage of a bit of dollar aversion while oil prices recovered from their U.S. session losses.
- Gold is up by 0.25% to $1,203.90 per troy ounce
- Brent crude oil is up by 0.07% to $75.93 per barrel
- U.S. WTI is up by 0.04% to $68.52 per barrel
Major Market Mover(s):
The Loonie received support after a report hinted that Canada is ready and willing to give in to some of the U.S.’ more important demands in favor of a deal.
USD/CAD is down by 24 pips (-0.18%) to 1.2908; CAD/JPY is up by 23 pips (+0.26%) to 86.19; EUR/CAD is down by 28 pips (-0.19%) to 1.5094; GBP/CAD is down by 38 pips (-0.23%) to 1.6609, AUD/CAD is down by 10 pips (-0.10%) to .9479; NZD/CAD is down by 10 pips (-0.11%) to .8663, and CAD/CHF is up by 18 pips (+0.24%) to .7565.
AUD and NZD
A combination of dollar weakness, overall risk appetite, and a steady yuan all helped boost commodity-related currencies like the Aussie and Kiwi.
AUD/USD is up by 6 pips (+0.08%) to .7344; AUD/JPY is up by 12 pips (+0.15%) to 81.70; AUD/CHF is up by 9 pips (+0.12%) to .7171; EUR/AUD is down by 12 pips (-0.07%) to 1.5923; GBP/AUD is down by 19 pips (-0.11%) to 1.7522, and AUD/NZD is up by 5 pips (+0.04%) to 1.0941.
NZD/USD is up by 4 pips (+0.06%) to .6712; NZD/JPY is up by 11 pips (+0.14%) to 74.68; NZD/CHF is up by 8 pips (+0.12%) to .6554, and GBP/NZD is down by 16 pips (-0.08%) to 1.9172.
Watch Out For:
- 5:00 am GMT: Japan’s consumer confidence (43.4 expected, 43.5 previous)
- 6:00 am GMT: Germany’s GsK consumer climate to remain at 10.6?
- 6:45 am GMT: France’s consumer spending (0.3% expected, 0.1% previous)
- 6:45 am GMT: France’s preliminary GDP (q/q) (0.2% expected and previous)
- 8:00 am GMT: Credit Suisse economic expectations