EU commission says aims to reach a trade deal with US before August 1

The positive headlines on a US-EU trade deal continue to filter through. Trump has already signed an executive order on Monday which extended the deadline for tariffs to August 1 (as widely expected).

The EU sources also told Reuters that they won’t be among the recipients of the tariff letters as they continue to work toward a deal. It looks like a deal could really be within reach and that’s what kept European stocks supported in recent trading sessions.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

ECB’s Lane: Data dependence also extends to incoming data outside the monetary domain

  • That considering shifts in international, domestic policy regimes are highly relevant for future inflation dynamics
  • Orientation for monetary policy stance now is to make sure that current, prospective shocks to the economy do not lead to medium-term deviations of inflation from the target
  • There has been a marked drop in energy prices and a substantial appreciation of the euro
  • Currently, there is high uncertainty about the future of the international trade system
  • Amid high uncertainty, it is vital to remain data dependent and take a meeting-by-meeting approach
  • ECB is basing monetary policy decisions on an integrated assessment of all relevant factors
  • It not only incorporates inflation path and the economy but also surrounding risks and uncertainty
  • Full remarks

The comments here aren’t anything that stands out too much. It’s just a generalisation of the approach that the ECB has adopted all through this year so far.

This article was written by Justin Low at www.forexlive.com.

BoE’s Bailey: Steepening in yield curves for bonds is not particularly UK-focused

  • QT is an open decision.
  • Global steepening of bond curves will have to be looked at carefully in annual QT decision.
  • We are seeing firms tell us that higher uncertainty is delaying investment decisions, including capital raising.
  • Caution on business investment will have some effect on employment.

Yield curves have been steepening pretty much everywhere. This happens when the difference between the short term and long term yields increases. QT has been cited as one of the possible reasons as central banks buy less long term bonds.

Another reason is that the market expects better growth ahead and/or higher inflation due to the fiscal and monetary impulses. I think this is the most likely reason.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

EUR/CHF Daily Outlook

EUR/CHF Daily Outlook

Daily Pivots: (S1) 0.9316; (P) 0.9341; (R1) 0.9358; More…. Intraday bias in EUR/CHF remains neutral as range trading continues. On the upside, break of 0.9428/45 resistance zone will resume the rebound from 0.9218. On the downside, break of 0.9305 will bring retest of 0.9218 low instead. In the bigger picture, while downside momentum has been […]

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