Forex Today: Sterling strongest in Asia on Brexit news, a quiet session ahead

Forex today witnessed some relief-gains amid broad-based US dollar weakness, with the Pound having outperformed its peers on reports of a Brexit customs deal. The GBP/USD pair rallied hard and tested the 200-DMA at 1.3555. The Antipodeans were the next biggest gainers, as investors shrugged-off mixed Australian employment data. The Kiwi tested 0.6940 on New Zealand’s budget release before paring back gains towards the 0.69 handle. The Aussie too failed to sustain the uptick and faced rejection near 0.7550 levels. Meanwhile, the Yen defended minor bid near 110.30 heading into the early European trades.

Among other related markets, the Asian equities traded mixed amid ongoing US-China trade talks. Both crude benchmarks clinched fresh four-year highs while gold prices were lifted amid weaker US dollar and steady Treasury yields.

Main topics in Asia

Britain will tell Brussels it is prepared to stay in the customs union beyond 2021

The Telegraph has said that Britain will tell Brussels it is prepared to stay in the customs union beyond 2021.

Fed's Bullard: inflation expectations are beginning to firm up

St. Louis Fed head James Bullard spoke with media today, outlining his take on US inflation and growth rates looking forward.

Australia jobless rate ticked higher in April, job additions beat estimates

The Australian economy added 22.6K jobs in April, still, the unemployment rate ticked higher to 5.6 percent from the previous month's reading of 5.5 percent, the Australian Bureau Statistics (ABS) data showed.

New Zealand government boosts spending, forecasts debt reduction

New Zealand's Labour-led government has unveiled a budget that includes NZ$3.8 billion of new capital investments.

China Commerce Ministry: To levy reciprocal tariffs on some US products

China Commerce Ministry is set to impose reciprocal tariffs on some US products and halt tariffs concession on US fruits and porks, according to Reuters report. 

China Commerce Ministry: China won't give in its core interests to resolve conflict with the US

Comments from China's Commerce Ministry are crossing the wires via Reuters …

Key Focus ahead

Today’s macro calendar remains relatively quiet in Europe, as no first-tier economic data is lined up for release. Hence, the focus will remain on the speech by the European Central Bank (ECB) outgoing Vice-President Vitor Constancio, as the Italian political drama continues to weigh down on the Euro.

The speech will be followed by the US jobless claims and Philly Fed manufacturing index alongside the release of the Canadian ADP Non-Farm Employment Change figures. Also, of note remains the Bank of Canada (BOC) economic review report, dropping in at 1430 GMT.

Thereafter, investors will find some incentives from the speech by the Fed officials Kashkari and Kaplan while BOE Chief Economist Haldane’s speech will also hog the limelight in the NA session.

EUR/USD finds itself above 1.18, but pressure is weighing

Souring core inflation figures for April sent the EUR/USD into a new 2018 low of 1.1763 before recovering slightly. Little impactful data sits on the calendar for Thursday, and volatility could pose a problem as the US Dollar drives the broader markets, with US Treasury yields still sitting at multi-year highs.

GBP/USD rises above 200-day MA on reports of Brexit customs deal, needs break above 1.3618

The oversold GBP is buoyed by the news of customs deal. The 5-day moving average (MA) and the 10-day MA are beginning to rise in favor of the GBP. Further, the 14-day relative strength index (RSI) is rising from the oversold territory, having created a bullish divergence over the last 12 days.       

Canada: Key events ahead - TDS

Analysts at TDS offer a brief preview of the Canadian April CPI and March retail sales data due to be reported this Friday at 1230 GMT.

US’ Officials: US, China to launch trade talks - Reuters

Reuters quoted senior Trump administration officials on Thursday, as saying that the US and China will launch trade talks today in an effort to avert a potential trade war.