Markets are keeping calm after a minor hiccup yesterday over tariff headlines, but the focus remains on the US-China trade deal signing later today. Looking ahead, a couple of data points to move things along with the big one being UK inflation data.
Stocks and bonds aren’t doing a whole lot as the focus remains on the key risk event in Washington later at 16:30 GMT, with traders and investors also keeping a close watch on the release of the details of the Phase One trade deal.
Major currencies remain little changed thus far as the steadier tones are giving little direction for traders to work with in general. The pound is a little higher, but cable still rests in a 29 pips range on the day, while EUR/USD has regained some poise in the last 12 hours or so but is still trapped in a bearish channel. The anti-risk yen traded better bid above 110.00 vs. the US dollar, as the losses in Treasury yields kept USD/JPY under pressure.
Oil prices slipped on Wednesday on concerns that the pending Phase 1 trade deal between the United States and China, the world’s biggest oil users, may not boost demand as the U.S. intends to keep tariffs on Chinese goods until a second phase.
Gold prices rebounded on Wednesday, snapping its recent declining streak amid fresh uncertainties surrounding the U.S.-China trade front.
The main event risk in the European session ahead remains the UK December Consumer Price Index (CPI) data due at 09:30 GMT. Also, of note remains that Eurozone Industrial Production and Trade Balance data, dropping in at 10:00 GMT.
In the NA session, besides the US-China phase one trade deal signing ceremony, sees the release of the US Producer Price Index (PPI) data at 13:30 GMT. The speech by the Fed official Harker also remains in focus ahead of the Fed’s Beige Book publication at 19:00 GMT.