Market wrap: Brexit in focus moving markets

In a market wrap, analysts at TD Securities explained that the GBP briefly rallied against EUR amid news that Germany was willing to accept a more vague statement on relations with the EU, easing the path to a Brexit deal, but gains were short-lived after a German spokesperson said the government position is unchanged.

Key Quotes:

"EM FX was mixed vs the USD, with the Turkish Lira and Argentine Peso improving +1% and +1.22% respectively, while the South African Rand lost -0.55% as the economy entered recession."

"After topping $71/bbl recently WTI crude ran into resistance, reversing nearly 1.5% back to $68.86/bbl on Wednesday. DOE inventories will be on Thursday this week."

"The BoC left rates unchanged at 1.50%, with the forward looking language also largely unchanged."

What We're Watching in Markets

"The rot in EMFX continues, just as the US/China $200bn showdown and the potential implementation of tariffs takes center stage. The G10 will not be immune; most have demonstrated a rising sensitivity to broad EMFX pain. This, along with trade ambiguity, could keep the USD broadly elevated for now.

Treasuries are paying minimal attention to EM tensions as corporate supply, trade concerns, and the upcoming payroll report remain top of mind. Industrial metals remain under pressure as trade tensions and EM weakness persist. Spec positioning continues to be at the lows and it is likely that any rallies will be sold until there is a sufficient resolution to trade war worries."

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