As geopolitical tensions between the East and West rise, sanctions and souring relations could have lasting impacts on business globally.
- Fears of a no-deal Brexit to keep pound on back foot
- Australian dollar looks for support from consumer confidence index
- Euro weakens after dovish ECB commentary
Speculation over Brexit is likely to drive further pound volatility over the course of the day, with markets still weighing up the odds of the UK leaving the EU without a deal.
In the wake of Theresa May’s latest parliamentary defeat there are doubts that the Prime Minister can secure sufficient support for a deal among MPs.
Unless there are signs of progress towards a resolution of the Irish border issue the mood towards the pound could remain bearish ahead of tomorrow’s UK employment figures.
Improved consumer confidence to boost Australian dollar
Tonight’s ANZ Roy Morgan weekly consumer confidence index could offer a boost to the Australian dollar, provided sentiment shows signs of picking up.
Any improvement in consumer sentiment would indicate a greater sense of confidence in the outlook of the Australian economy.
On the other hand, if consumers show signs of increased caution this is likely to keep AUD exchange rates on a weaker footing.
Market risk aversion could also weigh on the Australian Dollar today as investors await developments in the US-China trade agreement.
Euro to remain under pressure after dovish ECB comments
In the wake of unexpectedly dovish comments from a European Central Bank (ECB) policymaker ahead of the weekend the euro looks set to remain on a weaker footing this morning.
Without the support of any fresh domestic data the single currency may struggle to shake off the risk of the ECB implementing fresh monetary stimulus in the months ahead.
A decline in the US dollar could offer some support to the euro thanks to the negative correlation of the EUR/USD exchange rate, but as long as worries over the outlook of the Eurozone economy persist EUR exchange rates are likely to remain under pressure.
Monday, 18th February 2019
22:30 AUD ANZ Roy Morgan Weekly Consumer Confidence Index
Joining the corporate trading desk in 2007, Phil now over sees all of Currencies Direct’s corporate dealing activity. Having gained experience working with hundreds of businesses to optimise international payments processes and execute comprehensive risk management strategies, Phil currently works with a portfolio of corporate clients whilst managing Currencies Direct’s overall market exposure
Phil has FCA approval and has completed the Certificate in International Treasury Management (CertiTM)