· Positive news on the China-U.S. trade front helped boost risk sentiment on Monday, lifting the U.S. dollar to a one-week high against the safe-haven yen, while the British pound rose as UK election polls over the weekend continued to show a sizeable lead for the Conservative party.
China and the United States are very close to a “phase one” trade deal, the Global Times, a tabloid run by the ruling Communist Party’s official People’s Daily, said on Monday, discounting “negative” media reports.
Against the yen, which tends to strengthen in times of geopolitical or financial stress due to Japan’s standing as the world’s biggest creditor, the dollar was 0.29% higher at 108.95 yen, a 1-week high.
The dollar index, which compares the greenback against six major currencies, was up 0.03% at 98.298.
Investors view the United States as relatively well-positioned to weather a full-blown trade war should there be one.
Speculators raised net long bets on the dollar to a five-week high in the week to Nov. 19, data from the U.S. Commodity Futures Trading Commission showed.
Sterling climbed from recent lows as polls continued to show the ruling Conservatives as runaway favourites to win the Dec. 12 election with a pledge to implement Brexit and halt 3-1/2 years of political uncertainty.
The pound was 0.58% higher against the U.S. dollar.
· Monetary policy is “well positioned” to support the strong labor market, which is just now starting to benefit workers on the margins, Federal Reserve Chair Jerome Powell said Monday.
“The benefits of the long expansion are only now reaching many communities, and there is plenty of room to build on the impressive gains achieved so far,” Powell said in his remarks.
Powell said adjustments to employment data suggested the labor market may not have been as strong last year as previously thought, a shift that supported the case for lower rates.
· The inquiry into President Donald Trump’s dealings with Ukraine will enter a new phase shortly after Congress returns to Washington next week when lawmakers issue a report that could lead to impeachment charges against the president, the head of the committee leading the probe said on Monday.
U.S. House of Representatives Intelligence Committee Chairman Adam Schiff said the panels involved in the impeachment probe would send a report to the House Judiciary Committee after lawmakers come back on Dec. 3 from the U.S. Thanksgiving holiday.
· U.S. House Democrats said on Thursday they ironed out some differences with the White House over a trade agreement with Canada and Mexico, and Congress could still vote on the deal - one of President Donald Trump’s top priorities - this year.
House of Representatives Speaker Nancy Pelosi said the two sides made progress during her more than hour-long meeting with U.S. Trade Representative Robert Lighthizer and House Ways and Means Committee Chairman Richard Neal.
· Democratic presidential candidate Elizabeth Warren blasted billionaire Michael Bloomberg on Monday for launching his nascent White House bid with a $37 million TV advertising blitz, accusing the former New York City mayor of trying to buy American democracy.
Bloomberg, 77, a media mogul who will use his personal fortune to spend freely on his campaign and has said he will not take donations, officially jumped into the White House race as a moderate Democrat on Sunday.
· Tightening control over efforts to manage the upheaval in Hong Kong, the Chinese leadership has set up a crisis command center on the mainland side of the border and is considering replacing its official liaison to the restive semi-autonomous city, people familiar with the matter said.
Mainland China on Monday tried to brush aside the landslide defeat for the pro-establishment camp in Hong Kong’s district council elections, with news of the results on the mainland being heavily censored.
Official outlets say government supporters were harassed on the campaign trail and accuse Western countries of fuelling unrest
· Oil rose on Monday after posting three straight weeks of gains, pushed higher by positive comments from the United States and China that rekindled hopes in global markets that the world’s two largest economies could soon sign an interim deal to end their trade war.
Brent crude futures gained 25 cents to settle at $63.64 a barrel. West Texas Intermediate (WTI) crude gained 24 cents to settle at $58.01 a barrel.
A move by China to protect intellectual property was also providing a supportive atmosphere for the trade talks, McCarthy added.
Analysts at Barclays said they expect Brent to oscillate around $60 a barrel for the next two years.
Reference: CNBC, Reuters
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