Pound Reinforced on Brexit Advance
Swiss Franc, Japanese Yen and the greenback declined to trade as the softest ones. Loonie rose to become the firmest with Aussie and Pound following suit. Nikkei surpassed 1%. DOW reduced -0.23%. S&P 500 rose 0.19%. NASDAQ grew 0.27%. Nikkei increased 1.12%. Hong Kong HSI fell -0.31%. Singapore Strait Times dropped -0.27%. China Shanghai SSE lifted 0.10%. 5-year treasury yield was up 0.005. 10-year yield lowered -0.005. 30-year yield was down -0.015.
The US House Republicans issued a “Tax Reform 2.0” to achieve a committee-level vote this Thursday, and a full House vote on October 1. According to the new document, temporary individual rates reduction in the December tax cut plan will become permanent. And, maximum age for some contributions to retirement accounts would be liquidated. Furthermore, new firms would be allowed to write-off more start-up costs. Still, some analysts claim the Congress won’t pass the new tax plan.
Today, Canada and the US will resume the trade negotiation. Justin Trudeau (Canadian Prime Minister) pledged: “we continue to work hard and we are positively optimistic that we can get a win-win-win for all three countries.” Meanwhile, Robert Lighthizer (US Trade Representative) concluded a meeting with Cecilia Malmstrom (European Trade Commissioner). The former said: “Lighthizer discussed how the EU-US achieves concrete results in the short to medium term towards a free trade agreement.” The next meeting is scheduled for the end of this month.
The Pound was boosted by EU chief negotiator Michel Barnier’s statement. Barnier claimed: “if we are realistic we are able to reach an agreement on the first stage of the negotiation, which is the Brexit treaty, within 6 or 8 weeks.” And, “taking into account the time necessary for the ratification process, the House of Commons on one side, the European Parliament and the Council on the other side … we must reach an agreement before the beginning of November. I think it is possible.” The European Union will arrange a special summit for Brexit in November.
Australia NAB Business Confidence declined from 7 to the 2-year minimum of 4 in August. Business Condition grew from 12 to 15. Japan M2 was up 2.9% yoy in August. Tertiary industry index increased 0.1%. Today, UK will release employment data, Germany will announce ZEW economic sentiment and Canada will feature housing starts.