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Currency Market Analysis

Aug 28, 2019 | Currency Market Analysis

Global Themes

USDSGD climbs back as trade, yield curve, drive fears

The USDSGD rebounded as the August see-saw across financial markets continued.

Monday’s recovery was swiftly followed by renewed fears on Tuesday with the Chinese administration disputing President Trump’s characterisation of recent trade talks.

Additionally, a further slide in US bond yields extended the inversion of the US yield curve, a move that has historically signalled an impending recession.

Pressured

In other markets, safe haven like the JPY and CHF mostly gained.

The Canadian dollar fell as markets started to consider the change of a rate cut as trade worries hit the Canadian economy.

The British pound rebounded as UK opposition politicians entered talks to try and stop a “no deal” Brexit.

The Aussie was lower in most other markets, pressured by the overnight activity.

GDP in focus

The markets will be looking to recent growth over the next few days with June-quarter GDP numbers due from the US and Australia.

In Australia, June-quarter capital expenditure is due tomorrow, an important component for next week’s GDP reading.

Tomorrow night, US second-quarter GDP is released. With US data recently weakening, the release will be closely watched.


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