Interesting start to the week as the sterling fell sharply across board as markets factored in talks from Scotland to unveil single market Brexit plan this week. This and more on today’s daily Forex news.
20th December, AtoZForex – Further more on the daily Forex news, we look at the Bank of Japan’s latest policy stance.
#1 Scotland to unveil single market Brexit plan this week
The Scottish nation is making its own risk management plans to mitigate against a “hard Brexit”. The country has clarified that it will unveil proposals this week regarding how it can maintain its activity in the European Union’s single market after Britain leaves the bloc.Michael Russell, the Scottish government’s minister for EU negotiations said: “We will set out compromise proposals which, while not conferring the full benefits of EU membership, would mitigate the Brexit damage.”
#2 Goldman: OPEC Oil Cuts Not A Structural Shift
Even though the oil cut deal has prompted Goldman Sachs to edit its short to medium term oil outlook, the investment bank insists that the deal output cuts do not mark a structural shift for the oil cartel still driven by individual nations’ urge to raise output. Hence, Goldman expects some OPEC nations and Russia to revive high production levels once inventories are normalized. As well as the shale revolution further contributing to the flattening of the oil cost curve.
Opportunity: Buy oil on dips in the short term
#3 Three Fed Rate Hikes in 2017? US economy outlook
According to the economists recently surveyed by the Financial Times, the US central bank will wait six months until it hikes interest rates again. Policymakers will remain cautious in tightening policy before President-elect Donald Trump introduces measures he promised. The survey reveals that the respondents expect the Fed to increase short-term rate only two times, with the first increase occurring in June 2017. According to expectations of investors and traders, Trump together with a Republican-controlled Congress will be willing to implement tax reductions and fiscal stimulus that would boost the US economy.
#4 BOJ holds rate
The Bank of Japan held its negative interest rate of minus 0.1 percent, while also keeping its long-term interest rate such that purchase Japanese government bonds (JGBs) so that 10-year JGB yields will remain at around zero percent. With regard to the amount of JGBs to be purchased, the Bank will conduct purchases at more or less the current pace — an annual pace of increase in the amount outstanding of its JGB holdings of about 80 trillion yen — aiming to achieve the target level of the long-term interest rate specified by the guideline.
Opportunity: Buy USDJPY
#5 Russian Ambassador to Turkey Andrey Karlov assassinated in Ankara
Russia’s ambassador to Turkey, Andrey Karlov, was assassinated Yesterday. The ambassador was shot during a speech at a photography exhibition in the Turkish capital, the Russian Embassy said, adding that it believed that it was a radical Islamist attack. The shooter has been identified as police officer identified as Mevlüt Mert Altıntaş.
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