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Risk-on vibes from the earlier trading session carried on throughout U.S. hours, lifting the commodity currencies even higher.

On the flip side, the Swiss franc found itself behind the pack as traders might be adjusting positions ahead of the SNB decision, but clawed back some gains later on.

  • U.S. building permits down from 1.30M to 1.23M vs. 1.31M forecast
  • U.S. housing starts up from 1.17M to 1.28M vs. 1.24M forecast
  • EIA crude oil stockpiles down 2.1M barrels vs. projected 2.7M drop
  • Trump to nominate ex-Fed economist for board seat
  • New Zealand Q2 GDP at 1.0% vs. 0.8% consensus, 0.5% previous

Major Events/Reports:

Brexit-related remarks in EU Summit

The spotlight was still on Brexit as the U.S. session rolled along. Pound pairs were already off to a shaky start owing to rumors that PM May will reject the EU proposal, and it didn’t help that European Commission President Juncker remarked that they are still “far away” from a deal.

No. 10 herself sounded a bit more optimistic, citing that the EU would also need to make adjustments in order to strike a deal. Furthermore, PM May urged the Labour party to stop pushing for a second referendum, reiterating:

“I want to be absolutely clear – this government will never accept a second referendum.”

This was echoed by Brexit secretary Raab, who wrote an open letter to his Labour counterpart, challenging their party to clarify their position.

Meanwhile, in a recorded clip for broadcasters at the summit, Chancellor Hammond suggested that PM May bypass Barnier and talk to EU leaders directly instead.

On a slightly more positive note, European Council President Tusk confirmed that there would be a special Brexit summit in November to finalize a deal. He did admit that time was running out but sounded confident that the talks are entering “a decisive phase,” even as he pointed out that some U.K. proposals “will need to be reworked and further negotiated.”

Another risk-on day

The mood in Wall Street was still a positive one, as traders caught up to softer-than-expected tariffs from China and easing trade war jitters.

  • Dow 30 index is up 158.80 points to 26,405.76 (+0.61%)
  • Nasdaq is down 6.07 points to 7,950.04 (-0.08%)
  • S&P 500 index is up 3.64 points to 2,907.95 (+0.13%)

Both gold and crude oil were able to chalk up gains for the session, with the latter getting another lift from a larger-than-expected draw in U.S. stockpiles.

  • The precious metal advanced to $1,204.01 per troy ounce
  • WTI crude oil is up to $71.13 per barrel

Major Market Mover(s):

AUD & NZD

This comdoll tandem raced ahead of the forex pack, taking advantage of risk-on flows mostly on easing concerns about the trade war. The Kiwi also got a late boost from stronger-than-expected Q2 GDP.

AUD/USD is up from .7251 to a high of .7276; AUD/JPY bounced off the 81.50 area to a high of 81.65; EUR/AUD retreated below the 1.6100 handle, and GBP/AUD is down to 1.8103.

NZD/USD jumped to a high of .6652; NZD/JPY climbed from 74.03 to a high of 74.65; EUR/NZD slipped to a low of 1.7541, and GBP/NZD dipped below the 1.9800 mark.

CHF

The Swiss currency continued to slide against most of its peers as market participants may be adjusting their positions as the SNB decision drew near. Or could it be the SNB themselves starting to sneak up on the franc?

EUR/CHF crept from 1.1296 to a high of 1.1327 before dipping back to 1.1290; CAD/CHF is up from .7458 to a high of .7501; AUD/CHF rose from .7004 to a high of .7038, and CHF/JPY is down to 116.12.

Watch Out For:

  • 1:30 am GMT: RBA Bulletin
  • 7:30 am GMT: SNB monetary policy decision