· The U.S. dollar was broadly lower on Monday after President Donald Trump said over the weekend that trade talks with China were moving along “very nicely” but the United States would only make a deal with Beijing if it was right for America.
The dollar index .DXY was last down 0.15% at 98.202. Against the euro EUR=, the dollar was 0.15% weaker at $1.103.
Although the U.S. dollar often acts as a safe-haven asset in moments of political and economic uncertainty, it was lower on Monday against the Japanese yen and the Swiss franc, other traditional safe havens.
The dollar was 0.21% weaker against the Japanese currency, last buying 109.02 yen JPY=, and 0.42% weaker against the franc CHF=, at 0.993 per dollar. The yen and franc were in favor as market participants reacted to the violent response to protests in Hong Kong, where police fired live rounds at protesters and at least one person was wounded.
The Chinese yuan weakened 0.3% to 7.009 per dollar in offshore trade CNH=.
The British pound was up 0.63% at $1.285 GBP= as the economy dodged an outright recession, although growth in the three months to September was slower than expected. The British economy grew at its slowest annual pace in nearly a decade during the quarter as the global slowdown and Brexit worries hit manufacturing and business investment, official figures showed on Monday.
· President Donald Trump is expected to push back a decision on whether to impose tariffs on European Union automobile imports for another six months, Politico reported Monday, citing a person familiar with the decision.
Delaying the deadline by another six months would allow Trump to put off a decision on the new duties until the middle of 2020, when the presidential election is ramping up.
· House investigators are examining whether Trump abused his public office for private gain. At the center of the impeachment inquiry are Trump's communications with Ukrainian President Volodymyr Zelensky and his repeated efforts to pressure Zelensky to investigate former Vice President Joe Biden and his son for corruption ahead of the 2020 election.
Trump also asked Zelensky to investigate a bogus conspiracy theory suggesting it was Ukraine, not Russia, that interfered in the 2016 election and that it did so to benefit Hillary Clinton's campaign.
Several government officials have already testified to Congress behind closed doors, and their revelations paint a damaging portrait of a concerted effort across the administration to leverage US foreign policy to strongarm Ukraine into acceding to Trump's demands.
· After more than six years of negotiations, more than a dozen countries in Asia Pacific are now aiming to sign what would be the world’s largest trade agreement in 2020.’
The deal, called Regional Comprehensive Economic Partnership or RCEP, involves all 10 countries from the Association of Southeast Asian Nations (ASEAN) bloc and five of its major trading partners: Australia, China, Japan, New Zealand and South Korea.
Together, the 15 countries make up close to one-third of the world population and global gross domestic product, according to a Reuters report. That’s larger than other regional trading blocs such as the European Union and the United States-Mexico-Canada Agreement, or USMCA.
The mega-deal started with 16 countries but India decided not to join the trade pact over concerns that it would hurt the South Asian country’s domestic producers.
The mega-deal started with 16 countries but India decided not to join the trade pact over concerns that it would hurt domestic producers.
The urgency to conclude RCEP increased after U.S. President Donald Trump pulled his country out of another major free trade agreement, the TPP.
· EU foreign policy chief Federica Mogherini, France, Germany and Britain on Monday urged Iran to stick to the 2015 nuclear agreement with major powers or face action which could include the reimposition of sanctions.
The three countries and Mogherini expressed concerns about Iran’s decision to resume low-grade uranium enrichment at its underground Fordow nuclear plant last week, saying the move was inconsistent with the accord.
· President Hassan Rouhani said on Monday Iran would regain access to the international arms market later next year if it stuck to its 2015 nuclear deal with world powers and this would prove “a huge political success”.
However, while a United Nations-imposed arms embargo on Iran is supposed to be lifted in October 2020, five years after the nuclear deal took effect, it is questionable whether that will transpire given the recent unraveling of the accord.
· Oil prices edged lower on Monday as little progress on U.S.-China trade negotiations kept prices pressured, but bullish inventory data in the United States offered some support.
Brent crude LCOc1 futures lost 33 cents to settle at $62.18 a barrel, after falling to $61.57 earlier in the session. U.S. West Texas Intermediate (WTI) crude CLc1 fell 38 cents to settle at $56.86 a barrel.
Investors are worried about fallout from the 16-month U.S.-China trade war, which has slowed economic growth around the world and prompted analysts to lower forecasts for oil demand, raising concerns that a supply glut could develop in 2020.
“We expect the sideward trading to continue for the time being, with the trade conflict headlines likely to dictate the direction,” Commerzbank said in a note.
· The Abu Dhabi National Oil Company (Adnoc) and nine of the world’s largest energy traders have partnered with the Intercontinental Exchange (ICE) to set up the world’s first Murban crude oil futures contracts.
ICE Futures Abu Dhabi (IFAD) and ICE Murban futures are slated for launch in early 2020, subject to regulatory approvals, and will seek to rival well-established light crude oil benchmarks WTI and Brent.
Among the companies joining state-owned Adnoc, which produces around 1.7 million barrels of Murban crude daily, to take stakes in the new oil bourse are energy behemoths BP, Shell, Total, PetroChina and Vitol.
However, Brennock told CNBC that in terms of becoming a global crude marker, the Murban futures contract faces an “uphill struggle.”
“Previous attempts to launch a crude benchmark in the region have failed, most notably with the DME Oman futures,” he said. The DME Oman Crude Oil Futures Contract has struggled to demonstrate to investors the deep liquidity needed to rival Brent and WTI, and achieved a considerably lower volume of traded contracts since its inception.
“I just don’t think there is the appetite for another global crude benchmark. Accordingly, the Brent-WTI duopoly will continue to dominate the crude futures trading arena,” Brennock added.
Reference: Reuters, CNBC, Business Insider
Thai
Eng