Fed Chair Jerome Powell will testify today at 19:05 MT time. This event is crucial for traders as the tone of the speech may set the risk tone for the markets for the next two weeks.
Daily news: The US and Canada reached an agreement
- Canada and the US reached the final decision on the NAFTA deal on Sunday. It has been called United States-Mexico-Canada (USMCA) agreement since now. Trump will sign the agreement at the end of November and submit it to the US congress. Tariff decisions on steel and aluminum will be conducted in a different letter. An increase of dairy access to the Canadian market and protection of Canadian cultural industries are among the key points of these negotiations. As a result, USD/CAD dropped massively to its May’s lows below the 200-day MA at 1.2867 and aiming downwards the support at 1.2787. The next support is at 1.2740. If the positive news on the USD comes out, the pair can increase. In that case, it will return to resistance at 1.2847.
- The figure of manufacturing PMI of Great Britain was released today at 11:30 MT time. It reached higher than expected level and overcame the last month results (53.8 vs 53.0). At the same time, Brexit talks keep affecting the GBP. The UK finance minister Hammond said that the Canada-style trade agreement is not suitable for Great Britain. He also noted that once the deal would be reached, a boost to the UK economy could be possible. For now GPB/USD is trying to climb to the resistance at 1.3080. The next support for the pair is at 1.2943. In case of negative news, support lies at 1.2985 (50-day MA).
- The USD is awaiting for the manufacturing PMI index as well. It is forecast to be lower, than in the previous period (60.1 vs 61.3). In case of positive news, the resistance for the USD index is at 95.00, otherwise it will fall to the support at 94.45.
- EUR/USD keeps struggling with the problem of Italian budget. Up to now, the EU is anticipating more information concerning Italian budget data and responses from rating agencies. At the moment the pair is testing the 50-day MA at 1.1610, the next support is at 1.1506. If bulls strike back, the resistance is at 1.1661.
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Non-farm payrolls, the most awaited economic report, will be out on March 5 at 15:30 MT time.
Australian GDP rose by 3.1%, exceeding analysts’ forecasts of 2.5%. The Australian dollar climbed after the release, but then joined its peers in falling against the USD.
Great news for oil bulls! OPEC and its allied producers agreed to expand output cuts for the next month.
The USD skyrocketed after Fed Powell’s speech. OPEC and allied producers agreed to extend production cuts for another month. Oil surged.
The European Central Bank publishes its monetary policy statement that includes an announcement of the interest rate on March 11, at 14:45 MT time.