Currency Market Analysis

Dec 20, 2019 | Currency Market Analysis

Global Themes

The US Dollar is largely steady against major currencies this morning as we have a few key data points coming out today before the holiday week and year end. The buck is set for its best week in a month on the back of strong economic data. This morning’s Final GDP numbers for the UK came out better than expected, .4% growth, which strengthened the pound.

Later this morning, US Q4 GDP and Personal Spending numbers will be indicators of the strength of the economy going into 2020. These numbers will dictate the direction the Federal Reserve takes in 2020. Positive Economic data will further strengthen the belief that the Federal Reserve will pause on interest rate cuts for the near future.

Looking ahead to Christmas week, major market movers will involve any news regarding the impeachment process of Donald Trump, the signing of the US China trade deal in January and any more updates on Brexit.

EUR

The single currency is stagnant ahead of the holiday week. With no major market news coming out next week for the Euro, look for movements to be dictated by global headlines regarding the state of Brexit as well as news of the current political conditions worldwide. 

CAD

Commodity currencies are holding strong as the outlook for the global economy has improved. Canada showed in November an uptick of nearly 31,000 jobs which results in 5 consecutive months of job expansion. At 9:30 this morning Canadian Retail Sales numbers will come out and Monday look for Final GBP numbers for 2019 as well.

GBP

The pound is recovering from a long week on strong GDP number s and the appointment of Andrew Bailey as a well-known, stabilizing figure to lead the Bank of England through Brexit.  The focus next week will be on any news of Brexit as Boris Johnson aims to get bill signed by January 31st and not push the transition period past the end of 2020. The latter has set the new “cliff-edge” uncertainty to December 31st 2020 and is what had Sterling lose all its gains and momentum from the post-election results. 

Please Note:

The ‘Daily Market Update' will be on a break from the 23rd of December, 2019 to the 5th of January, 2020. The 'Daily Market Update' will resume from January 6th, 2020.




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