 Fed Chair Jerome Powell's speech last week was sort of a turning point. Stocks staged a strong rally and helped lifted Kiwi and Aussie as the strongest ones. Nevertheless, despite being sold off steeply, Dollar has indeed reversed much the the losses and ended as the third strongest one. Sterling ended as the weakest one as traders turned defensive ahead of the Brexit vote in the parliament on December 11. Yen was the second weakest for the week, followed by Canadian Dollar, which decline together with oil prices. The immediate near term outlook of the markets will depend on the result of the Trump-Xi summit in Argentina. The two presidents are scheduled to have a dinner on Saturday night, as sideline of the G20 summit in Argentina. Ahead of that, there were a lot of rumors, comments and news floating around. For example, Trump indicated it's "highly unlikely" for him to hold off raising tariffs on USD 200B in Chinese goods on January 1. He also tried to sound hardline, repeating that China wanted to make a deal, but he's happy with the current one right now. There were also reports that both countries are exploring a trade pact. It's hard to determine whether the US-China news were real or just diplomatic smokescreens. So we'd refrain from making any prediction on the outcome. Nonetheless, we're just hours away from know the results. So better just be patient. |
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