European Currencies Advance on Brexit Deal Hopes, Italy's Budget in Focus


The British Pound rebounded from a two-week low against the United States dollar on higher chances of a Brexit deal. The Cable found support following news that the British Prime Minister Theresa May is ready to drop key Brexit demand in hopes of reaching a deal. Moreover, the Chief European Union negotiator Michel Barnier confirmed the high chances of reaching a deal. The GPBUSD is trading at $1.3075, and the GBPJPY is trading at 147.43.


The Euro advanced against the dollar on chances of a Brexit deal. However, investors remain cautious ahead of expected developments in the Italian budget concern. On Thursday, the European Commission criticized Italy's draft budget plan and said that it breaches the fiscal rules of the European Union. Italy's government should explain today to the Commission its breach of rules. The EURUSD is trading at $1.1545, and the EURJPY is trading at 130.18.


The dollar index which measures the greenback against a basket of major currencies retreated from a two-week high to end a three-day winning streak. The hopes of a Brexit deal weighed on the dollar, and DXY is trading at 95.49.


Gold prices remain caught in a tight trading range between a support zone near $1216 and a resistance zone near $1233. The growing stock market risks and uncertainty boosted the demand for the precious metal. The gold ounce is trading at $1227, and the silver ounce is trading at $14.65.


Oil prices climb as we approach the implementation date of the U.S. sanctions on Iran. The United States sanctions will take place on the fourth of November where the Trump administration is trying to reduce Iran's oil exports to zero to force the country to renegotiate a nuclear deal. As a result, market participants expect the oil market supply to tighten and lead to higher prices. The West Texas Intermediate crude futures rose to a high of $69.81, and the Brent futures traded at a high of $80.38 during the Asian session.

Major Economic Events

GMT Country Event Expectation Previous
12:30 CA Wholesale Sales (MoM) (Aug) 0.1% 1.5%


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