The head of the Federal Reserve Jerome Powell will testify on the Semiannual Monetary Policy Report on Tuesday and Wednesday
UK pound rallies due to Irish border deal
On Monday, the UK currency managed to rally following news that the United Kingdom is on the verge of compromising on the Irish border issue with the aim of moving forward with a Brexit deal.
The currency pair GBP/USD tacked on by 0.28% ending up with 1.3066, which is not far from an earlier maximum of 1.3078.
British Prime Minister Theresa May intends to make another Brexit deal with the European bloc, as Bloomberg informed. As a senior UK government official revealed to Bloomberg, Britain seeks ways to come to a compromise on the border issue.
The compromise would be a last resort if a compromise isn’t reached and it would be conditional on Great Britain having complete access to the EU customs union. By the way, the European Union has already offered to permit Northern Ireland to trade with Ireland without full checks that May has rejected telling that it would heavily impact Great Britain.
Besides this, the USD index, normally estimating the greenback’s purchasing potential against a number of its key counterparts declined by 0.05% hitting 94.75 because trade tensions weakened and market participants shifted to riskier assets.
On Sunday, Canada and the United States managed to reach a trade deal on the North American Free Trade Agreement, several hours before the deadline.
By the way, the deal acquired a new name - the United States-Mexico-Canada Agreement. The given pact will give America access to Canadian dairy market and will also cap Canada's car exports to America.
As for the Canadian dollar, it hit a four-month maximum. The currency pair USD/CAD slumped by 0.76% being worth 1.2812.
The common currency went down because investors were still cautious after Italy's government announced a budget deficit, which defied Brussels. Moreover, the European Commission is anticipated to reject Italy’s budget initiatives.
The currency pair EUR/USD slumped by 0.02% trading at 1.1602.
The United States will publish the non-farm employment change, also known as non-farm payrolls (NFP) at 15:30 MT time on February 7.
The level of non-manufacturing PMI for the United States by the Institute of Supply Management will be published at 17:00 MT time on February 5.
The Federal Open Market Committee will publish its meeting minutes on February 19, at 21:00 MT time.
Will coronavirus continue keeping the markets in fear? What releases should we wait for? Find out in the news!
Tesla stock drops in premarket trades on Thursday. Why? See the article (it's short) and use it to your advantage.