Loonie Hopeful About NAFTA Talks, Stocks Weaken
Loonie reinforced to trade as the strongest thanks to resumption of U.S.-Canada NAFTA negotiation. Swiss Franc follows suit. Aussie and Kiwi are strong on rebound in Asian stocks. Nikkei grew 0.68% to 22968.18. Hong Kong HSI rose 0.14% and Singapore Strait Times was up 0.17%. China Shanghai SSE reduced -0.35%. Meanwhile, DOW increased 0.06%. S&P 500 rose 0.03% and NASDAQ was up 0.15%. DAX dropped -0.09% and CAC was down 0.11%. Japanese Yen and US dollar are the softest. Sterling declined too.
Canada and the US resumed their trade talks. Chrystia Freeland, Canadian Foreign Minister, told she had a “very constructive meeting” with US Trade Representative Robert Lighthizer, and the meeting is yet to continue today. The key point of discussion are expected to be dairy products. Larry Kudlow (White House top economic adviser) noted that “there’s a word that Canada has trouble with and it’s M-I-L-K. Milk. Anything to do with milk and dairy — they have this government-run, centrally planned system and some tariffs run upwards of 300 per cent. They’re going to have to fix that.”
Kudlow also claimed: “the president did say if he cannot satisfactorily negotiate with [Canada] he may have to go to a large 20 to 25 per cent tax on Canadian automobiles headed for the U.S.” Donald Trump set the deadline for Canada to join the U.S, and Mexico on Friday - the day when the White House will give Congress its mandatory 90-day notification of the new trade deal.
UK BRC shop price index increased from -0.3% in July to 0.1% yoy in August. Today, Germany will release Gfk consumer sentiment and France will feature Gross Domestic Product of the second quarter. The US will publish Q2 GDP revision and pending home sales and Canada will announce current account for the second quarter.