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UK Government’s Brexit Plans Shock Markets, Pound Plummets

Pound News: Revived No-Deal Brexit Fears Send Pound Plunging

The pound plunged today after reports emerged that the UK government was preparing to override parts of the Brexit withdrawal agreement on Northern Ireland.

Added to this, Boris Johnson indicated the UK would end Brexit trade talks on October 15th, if no progress is made. This caused the Pound to slump on Monday as markets expect this would make the chances of a no-deal Brexit even more likely.

The UK lacks economic data releases until a number of high-impact publications that will drive the pound’s movement. Until then, GBP exchange rates will likely stay under pressure from doubts over the UK-EU trade talks progressing this week.

 

Euro News: Euro Steadies as Markets Await European Central Bank (ECB)

The Euro weakened slightly last week, but the currency’s movement steadied today, making gains against the Pound.

The Euro outlook is weakening on speculation that the European Central Bank (ECB) will talk down the Euro’s strength at its upcoming policy decision, and revise its inflation forecasts.

The ECB’s September policy decision is set for Thursday, until the tomorrow’s Eurozone growth rate results will prove influential for Euro exchange rates as well.

 

US Dollar News: USD Rebound Continues on Unemployment Figures

The US Dollar was one of the stronger major currencies today, despite US markets remaining closed due to Labour Day.

The US Dollar continued recovering despite US political and economic uncertainty as the Pound weakened and USD investors cheered Friday’s weaker-than-expected non-farm payroll data that saw unemployment drop below 10% to 8.4%.

This week’s US economic calendar will be quieter than last week’s, with USD movement responding to market sentiment and the return of the US Senate and House of Representatives, renewing hopes of a new US fiscal stimulus package.

 

Canadian Dollar News: CAD Gains Limited amid Bank of Canada Anticipation

The Canadian Dollar was up today, but it struggled to capitalise on the Pound’s Brexit-inspired losses.

CAD exchange rates are likely to remain steady ahead of Wednesday’s Bank of Canada (BoC) policy decision, while weaker prices of oil, Canada’s biggest export, weigh on the Canadian Dollar.

No notable Canadian data is expected tomorrow, which will leave investors anticipating Wednesday’s Bank of Canada policy decision.

 

Australian Dollar News: ‘Aussie’ in Strong Rebound despite RBA Speculation

The Australian Dollar rebounded today, capitalising on the Pound’s Brexit losses. This is despite last week’s Australian Dollar weakness, and fresh speculation of a more dovish Reserve Bank of Australia (RBA). Markets are betting that more easing from the RBA is on the way.

Tuesday’s Asian session will see the publication of Australian business confidence data from NAB. If this data beats forecasts, it could offer some support to the Australian Dollar outlook.

 

Upcoming Data

Tuesday, 8th September

02:30    Australian NAB Business Confidence

07:00    German Trade Balance

07:45    French Trade Balance

10:00    Eurozone Growth Rate

10:00    Eurozone Employment Change

11:00    US NFIB Business Optimism

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