Earlier in the Day:
The economic calendar was on the lighter side through the Asian session this morning. Stats were limited to New Zealand July trade figures.
Outside of the numbers, the Asian market reacted to the escalation in the U.S – China trade war on Friday and Trump’s Twitter tantrum.
Updates from the G7 Summit also influenced through the early part of the session.
For the Kiwi Dollar
The trade deficit widened from a revised NZ$4,980m to NZ$5,460m, year-on-year, in July. Month-on-month, the trade balance slumped from an NZ$331m surplus to an NZ$685m deficit.
According to NZ Stats,
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Goods import values increased by NZ$173m (3.1%), while the total value of goods exports fell by NZ$309m (5.8%)
The Kiwi Dollar moved from $0.63475 to $0.63498 upon release of the figures. At the time of writing, the Kiwi Dollar was down by 0.70% to $0.6360.
Elsewhere
At the time of writing, the Japanese Yen was up by 0.44% to ¥104.93 against the U.S Dollar, while the Aussie Dollar was down by 0.75% to $0.6705 at the time of writing.
The Day Ahead:
For the EUR
It’s a relatively busy day ahead on the economic calendar. Germany’s Ifo business sentiment figures are due out later this morning.
Last week, Germany’s private sector PMI surveys revealed a marked deterioration in optimism, suggesting EUR negative numbers.
An escalation in the U.S – China trade war last Friday will not have helped sentiment mid-way through the 3rd quarter.
While the numbers are EUR negative, the Dollar could be in for another bashing should any updates from the G7 Summit suggest more tantrums to come.
At the time of writing, the EUR was up by 0.01% to $1.1145.
For the Pound
It’s a quiet day ahead on the data front. There are no material stats due out of the UK, with the UK on holiday.
The lack of stats will leave the Pound in the hands of Brexit chatter and further MP reaction to Boris Johnson’s brief visit to Europe.
Ultimately a lack of progress leaves Johnson exposed and Corbyn will be looking to garner the necessary support to win a vote of no-confidence next week.
Brexit chatter from the G7 Summit and Johnson’s inquiry into the legalities of shutting down Parliament for 5-weeks also needs consideration.
At the time of writing, the Pound down by 0.02% to $1.2263.
Across the Pond
It’s a relatively quiet day on the economic calendar, but not without influence.
Following last week’s private sector PMI numbers that revealed a first contraction in the manufacturing sector since Sep-09, we can expect plenty of sensitivity to today’s numbers.