It was a relatively quiet start to the week as markets gear up for the non-farm payroll report to come on Friday. A host of data from Australia released earlier today has already started moving markets. This and more on today’s daily Forex news and trade opportunities.
4th October, AtoZForex – Others news on the daily Forex news list include UK construction PMI and New Zealand GDT Price Index.
#1 Where is oil headed after OPEC?
Last week, we had the first OPEC agreement since 2008 where production was agreed to be cut from current levels of 33.5m barrels per day (bpd). OPEC output will be cut to between 32.5 million bpd and 33 million bpd and the allocations would be concluded in the 30 November OPEC meeting in the Vienna. This agreement represents a distinct shift in the Saudi-led OPEC strategy to push out high-cost producers to gain market share, at the cost of lower oil prices.
#2 Brexit process to start in March
Prime Minister Theresa May exposed more information about the Article 50 of the Lisbon Treaty implementation process. During the weekend Conservative Party conference, the UK Prime Minister revealed that no unnecessary delays will be taken to invoke Article 50, aiming by the end of March 2017.
Opportunity: Sell GBPUSD on rallies
#3 RBA leaves rates unchanged
As generally expected, following two prior rate cuts this year, the Reserve Bank of Australia opted to leave rates at record lows of 1.5% this month. As the board decided that this would be consistent with sustainable growth in the economy and achieve the inflation target over time. The building approvals data also released showed a -1.8% change in the number of new building approvals issued.
#4 Barclays believe in no oil prices crash
As oil steadies, market experts see the downside risk to oil prices in the possibility of the weak effectiveness of the deal on Wednesday. In its note to clients, Barclays has stated the following: “OPEC has created its own Q4 risk to oil prices … In raising expectations of a November deal to cut production, it also risks a steep price decline should it fail to achieve its goal of cutting output back to less than 33 million bpd.”
#5 Pound hits a new 31-year low
Following UK Prime minister Theresa May’s statement over the weekend about a set date for the commencement of Brexit processions, the sterling opened with a strong gap down. The currency has continued its dip on Tuesday, after breaking through its post-referendum low to reach levels not seen in over 30 years. It is now presently trading around a 31-year low against the dollar and a fresh 3-year low against the euro.
#6 UK construction PMI due
Following the positive manufacturing data released yesterday, the construction PMI is now due for release. It is forecast to show the industry has continued contraction at 49.1 and at a faster pace than in August.
Opportunity: Sell GBPJPY on disappointing data
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