A pedestrian walks past an electronic stock board displaying a graph of the exchange rate of the yen against the U.S. dollar at a securities firm in Tokyo, Japan, on Thursday, Aug. 30, 2018.
Kiyoshi Ota | Bloomberg | Getty Images
This week, the British government will present the full Withdrawal Agreement Bill to try and pass it through both the upper and lower houses of Parliament. A decisive vote by lawmakers would likely come later in the week.
The pound “is likely to remain somewhat volatile, but supported, because it appears the chances of a hard (no deal) Brexit are very slim, and either another Brexit delay, or the ratification of the new Withdrawal Agreement in the U.K. House of Commons, will occur this week,” currency strategists at the Commonwealth Bank of Australia wrote in a morning note.
The British pound changed hands at $1.2914, climbing from an earlier level around $1.2873.
U.S.-China trade talks
Elsewhere, the U.S. and China made ‘substantial progress’ at trade talks, according to Chinese Vice Premier Liu He, Reuters reported. After reaching a partial trade deal earlier this month, Beijing and Washington are working to pen a written agreement.
Both sides have applied tariffs on billions of dollars worth of each other’s products, which have roiled global markets, created business uncertainty and dented economic outlooks around the world. China said last week its economy grew by 6% on-year in the third quarter, which is believed to be the slowest GDP gain for the country in at least 27.5 years.
“US-China trade tensions are weighing on China’s manufacturing and export sectors while Beijing’s measured fiscal and monetary stimulus are only an offsetting force,” Rodrigo Catril, a senior foreign-exchange strategist at the National Australia Bank, wrote in a morning note.
“China’s economic growth is slowing as officials have one eye on US tensions while at the same time they strive to tidy up the financial system and limit excessive credit growth,” Catril said, adding if U.S. tariffs are not removed, “further economic slowdown looks likely.”
The U.S. dollar traded at 97.313 against a basket of its peers, dropping from levels near 97.400. The Japanese yen, which is considered a safe-haven currency, traded at 108.42 per dollar, weakening from around 108.28, while the Australian dollar changed hands at $0.6850, a touch lower than an earlier high around $0.6855.
What’s on tap
Here’s the economic calendar for Wednesday (all times in HK/SIN):
9:30 a.m.: China loan prime rates