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Brexit jitters were front and center of price action once more as U.K. PM May rushed to Brussels for a surprise meeting but failed to bring good news.

Meanwhile, the Greenback has managed to pocket a few pips even with a few concerns still lingering.

  • Canadian foreign securities purchases slumped from 23.97B CAD to 9.85B CAD
  • Empire State manufacturing index rose from 24.4 to 30.2 vs. 20.3 forecast
  • U.S. President Trump also considering David Malpass as Fed governor?
  • New Zealand CPI up 0.5% vs. 0.4% forecast in Q3

Major Events/Reports

Fears of Brexit talks collapsing

Following No. 10’s previously unannounced dinner meeting with EC President Juncker, a source close to the U.K. negotiating team ‘fessed that the government is worried about talks collapsing unless the EU gives in to some of the Brits’ demands.

Note that a summit of EU leaders is scheduled for Thursday this week, possibly overshadowing all the top-tier U.K. economic data on the docket, and that previous discussions with the U.K. have wound up in a deadlock.

Still, May and Juncker mentioned in their joint statement that they had a “broad, constructive” working dinner and “agreed that these efforts should accelerate over the months to come.” 

On a less downbeat note, it was also reported that Germany is drafting a “comprehensive free-trade accord” between the EU and the United Kingdom.

The search for the next Fed head

The Donald seems to be missing his reality TV days as he has recently gotten busy with holding auditions for the next Fed head.

You see, Yellen’s term is slated to end in February next year and rumor has it that Trump isn’t really looking to extend her stint.

In addition to the list of candidates for Fed Chairmanship that most market watchers are already scrutinizing, a report indicated that the U.S. President might also be considering Stanford University economist John Taylor.

Now Taylor is seen as a relatively hawkish candidate compared to the rest of the front-runners, although he also previously mentioned that he would like to see rates stay low in an interview back in July.

Meanwhile, Trump is also scheduled to have a sit-down with Yellen herself later this week before making his decision “over the next two or three weeks” according to chief of staff John Kelly.

Major Market Mover(s):

GBP

Volatility was the name of the game for sterling as the currency tossed and turned on Brexit updates.

GBP/USD dipped to a low of 1.3225 then edged up to 1.3252, GBP/JPY retreated from 148.62 to a low of 148.19, EUR/GBP popped up to a high of .8922, and GBP/AUD is down to the 1.6900 handle.

USD

The Greenback made a bit of recovery on upbeat economic data, shrugging off the uncertainty surrounding the Fed leadership as diplomats from the U.S. and North Korea are reportedly hashing things out.

USD/JPY found support at 111.70 then recovered to a high of 112.21, USD/CHF ticked up to .9756, EUR/USD edged back below 1.1800, and AUD/USD is down to .7840.

Watch Out For:

  • 1:30 am GMT: RBA meeting minutes (Review the latest RBA decision here)
  • 1:30 am GMT: RBA Assistant Governor Debelle’s speech
  • 1:30 am GMT: Australian new motor vehicle sales