U.S. and Chinese deputy trade negotiators were set to resume face-to-face talks on Thursday for the first time in nearly two months as the world's two largest economies try to bridge big policy differences and find a way out of a bitter and protracted trade war.
The negotiations, on Thursday and Friday, are aimed at laying the groundwork for high-level talks in early October that will determine whether the two countries are working toward a solution or are headed for new and higher tariffs on each other's goods.
A delegation of about 30 Chinese officials, led by Vice Finance Minister Liao Min, we're set to launch talks on Thursday morning at the U.S. Trade Representative's (USTR) office near the White House. The U.S. side is expected to be led by Deputy Trade Representative Jeffrey Gerrish.
The discussions are likely to focus heavily on agriculture, including the U.S. demands that China substantially increase purchases of American soybeans and other farm commodities, a person with knowledge of the planned discussions told Reuters.
Two negotiating sessions over the two days will cover agricultural issues, while just one will be devoted to the strengthening of China's intellectual property protections and the forced transfer of U.S. technology to Chinese firms.
Many of today’s payments can already be sent as quickly as a WhatsApp message, but still, rely on the old infrastructure systems playing catch-up in the background with a delayed settlement.
These efforts come with small overheads that are passed on to customers. Per-payment expenses that can’t be fully eliminated create issues for those whose transactions won’t fall above this minimum threshold.
Even fees of ten cents or less would prevent someone who only wants to send $0.25, for example, from doing so efficiently.
Simple ideas such as microtransactions, therefore, do not exist in a meaningful way for those who need them. In response, the future payments space is slowly breaking down these barriers, fashioning groundbreaking business and countless investing opportunities alike.
The payments space is unique in the fact that it’s one of the few being evolved from the outside-in by still-unregulated disruptors, as well as from the inside-out by deeply entrenched incumbents.
Expansive and influential tech giants have a significant stake in the evolution of payments, and in some areas of the world, they have already drastically reduced the number of people fumbling with paper money and coins at cash registers.
France and Germany are agreed on a strategy to respond to a global economic slowdown at a time of international trade problems but differ over how fast to move, French Finance Minister Bruno Le Maire said on Thursday.
French policymakers are growing anxious as Germany, Europe's largest economy, dithers over how to pull itself back from the brink of recession, and they want Berlin to do more with its budget surplus to engineer a recovery.
In a news conference alongside Germany's finance and economy ministers, Le Maire said the strategy was based on three pillars: "keep reducing public debt where it is necessary. And it is the case in France; keep pursuing structural reforms, as we are doing in France; have budget policies that can take up the baton from monetary policy."
However, Le Maire said that while there was agreement on the approach, there remained an open debate on the timeframe for action.
Seeking to underline Franco-German economic cooperation, Le Maire said a pilot plant in France to manufacture electric car batteries would go online in 2022, two years before a second factory opens in Germany, part of a pan-European project to rival Asia's dominance of the battery market.
Oil prices climbed on Thursday amid renewed concerns over risks to global supply in the wake of last weekend's attacks on Saudi Arabia’s oil infrastructure.
U.S. crude futures rose 1.1% or 70 cents to trade at $58.73 per barrel by 9:35 AM ET (1:35 GMT) after rising as high as $59.48 earlier.
Global benchmark Brent crude futures were up 1% at $64.67 a barrel, off a session high of $65.56.
The attacks knocked out around half of Saudi crude production and severely limited the country's spare capacity, a cushion for oil markets in any unplanned outage.
"Global available spare capacity is extremely low at present following the weekend attacks, leaving little room for additional outages, which tends to be price supportive," UBS oil analyst Giovanni Staunovo said.
Earlier this week Saudi said production would be back to normal levels in two to three weeks, which means restoring output to about 10 million barrels per day.
But traders and analysts are sceptical, while the lack of transparency about Saudi inventories adds to uncertainty about whether Riyadh can keep markets supplied without disruption.
The GBP/USD pair is trading between 100 and 200 day moving average while the pair has erased the earlier gains, retracing back below 1.2500 handle.
If the price sustains below 1.2500 handle, it may further fall to 1.2405 ahead of 1.2340 level. However, moving back above 1.2500 will help maintaining the bullish tone.
The precious metal retreated back to $1500 mark after hitting daily high of $1507 earlier on the day amid recovery seen in the US Dollar.
US treasury yields have gained today that reflects the improved risk sentiment which dented the safe heaven appeal of gold.
Technically, the price stays above 20-day moving average but still playing within the range. This indicates no clear trend but the tilt is still bullish.
Technical levels to watch
The USD/CAD pair built positive momentum and jumped above 1.3300 handle after dismal Canadian retail sales figures published.
The US Dollar demand boosted further that also helped the pair in gaining positive traction. Meanwhile oil prices found mild support that put a lid on further gains for the
Technical levels to watch
The EUR/GBP pair seems like catching strong support around 0.8800 handle for the short term, noted by Commerzbank analysts.
“EUR/GBP finally slipped through the 200 day moving average at .8794 as expected with the 61.8% Fibonacci retracement of the May-to-August advance at .8794 currently being tested. For now it seems to hold, though. Below it lies the May 27 low at .8769”.
“Minor resistance above the .8891 July low and the .9016 September 9 high can be seen between the mid-July high and the 55 day moving average at .9043/52. Further resistance comes in at the .9149 current September high”.
“Still further up sits the August peak at .9327”.
UOB Group analysts suggest that the GBP/USD may consolidate and move lower if stays the price does not clear 1.2580 in the near term.
24-hour view: “GBP traded mostly sideways but surged suddenly to a 2-1/2 month high of 1.2560 during NY hours (on the back of Brexit headlines). The sudden surge appears to be running ahead of itself and further sustained advance is not expected for today. However, GBP could retest 1.2560 but a clear break of this level is unlikely (there is another strong resistance at 1.2580). Support is at 1.2490 but the more significant support is closer to 1.2460”.
Next 1-3 weeks: “The sudden surge in GBP yesterday sent it soaring to 1.2560, within sight of the 1.2580 level that we first indicated on Monday (16 Sep, spot at 1.2495). While we continue to see chance for GBP to test 1.2580, the recovery phase that started about 2 weeks ago (05 Sep, spot at 1.2245) is deep in overbought territory now. In other words, the prospect for a clear break of 1.2580 is not that high. In order to ‘overcome’ the current overbought conditions, GBP has to ‘punch’ through 1.2580. Otherwise, if GBP were to ‘hang around’ these elevated levels, the risk of a short-term top would increase quickly. On the downside, the ‘strong support’ level has moved markedly higher to 1.2430 from 1.2350 previously. A break 1.2430 would indicate that the recovery phase has run its course. Looking ahead, if GBP were to ‘punch’ above 1.2580, it could potentially lead to a ‘rapid rise’ as the next significant resistance is at 1.2780”.
The USD/JPY pair is under pressure on the Friday for second straight session. Bank of Japan has not followed the ECB and FOMC and refrained from cutting rates. This factor has helped the JPY to remain strong.
US treasury yields are under pressure despite hawkish rate cut of the USD. This could be due to geopolitical tension escalated in the middle-east.
The USD/CHF pair is trading above 0.9900 handle ahead of European session. Earlier, the pair could not hold gains near 0.9980 area and dropped lower.
If the sellers dominate, the price may further dip to 0.9835 area. Alternatively, if the greenback surges, the pair may find a boost o 0.9950 area followed by the parity level.
CommerzBank technical analysts note that the EUR/USD pair may test 1.1083-1.1110 area if remains above 1.0990.
“EUR/USD still targets the April and May lows as well as the three month resistance line at 1.1083/1.1110, having bounced off the September 17 low at 1.0990”.
“Only a daily chart close above the August 26 high at 1.1164 would confirm a bottoming formation and put the 200 day ma at 1.1253 back on the cards”.
“Support below the recent lows at 1.0927/26 comes in at the June 2016 low and the March 2017 high at 1.0912/07”.
UOB Group analysts point out that divided FOMC may further cut the rates.
“The FOMC, as widely expected, cut its policy Fed Funds Target Rate (FFTR) by 25bp to a range of 1.75-2.00% in its Sep meeting, but it was not a unanimous decision as there were three dissenters: Boston Fed President, Eric Rosengren and Kansas Fed President, Esther George dissented for the second consecutive meeting because they wanted to keep rates unchanged. In contrast, St Louis Fed President Bullard dissented because he wanted to cut FFTR by 50bps instead of 25bps”.
“But the split within the ranks of the Fed Reserve has intensified based on 1) the increase in number of dissenters within the FOMC voters and 2) the emergence of three distinct groups of FOMC participants according to the Sep Dotplot’s 2019 FFTR projection. If the lack of consensus (widening of differences) worsens further, then that will complicate the FOMC outlook and weaken the case for lower rates for the rest of this year”.
“There was no material change in the text of the Sep FOMC statement with the Fed keeping its pledge to “act as appropriate to sustain the expansion” which still keeps the door open for the Fed to rate cuts. In his press conference, FOMC Chairman Powell said the Fed lowered interest rates to keep economy strong, provide insurance against risks, but he still did not commit to further rate cuts, only “moderate rate adjustments.”
“After delivering the two 25bps cuts in Jul and Sep, we still project two more 25bps “insurance” rate cuts at the 29/30 Oct and the 10/11 Dec FOMC, bringing the upper bound of the FFTR lower to 1.5% and well below the 2% inflation target. But the split within the ranks of the Fed Reserve adds uncertainty to our call. We are still confident of the Oct rate cut but have lowered the probability of a Dec rate cut from 75% to 55%”.
Fx options expiring today at 10 am NY time via DTCC:
The sentiment towards the common currency remains strong , but the EUR/USD retreats from the 1.1070/80-day high on European afternoon.
The pair is now building up its staggering performance within the familiar range while trading below 1.1100.
The buying interest against the euro has increased as the German 10-year yield recovers, reducing the spread to the US counterpart.
The greenback did not react to the Philly Fed manufacturing index, which was 12.0 ahead of the forecast. Initial jobless claims were at 208K, while the 4-week average fell from 213.00K to 212.25K and the Q2 current account deficit dropped to $ 128.2 billion.
The single currency is building on its volatile performance this week as the important FOMC meeting on Wednesday is over. The euro lost over 1.11 in gloss, a level reached after the European Central Bank announced it would launch a bond-buying program with a monthly volume of € 20 billion, which was less than expected by the market.
It's the big currencies ' weakest. Rates remained untouched by the Bank of England and the Bank of Japan. The GBP/USD had an up and down day at the beginning of the NA session, trading close mid-range. This handle is a break-point with 100 days SMA resistance, preceded by a weekly bearish entrance gap with swing lowers close the 107.50-45 area.
In the meantime, technical indicators on the daily chart have lost meaningful momentum, but retained a bullish tendency, supporting the possibility of dip buying. There is, therefore, a chance to start some new tumultuous roles to try the very significant 200-day SMA in any successive fall towards the described aid, about the middle of 107.00.
The swinging strong overnight – all over the 108.50 area – could serve as an intermediate resistance to the 109.00 handle, over which the pair can speed up the strong strength to its next major obstacle close to the 109.40 area.
The SNB remained constant prices, contributing to the increase in CHF. SNB is the strongest. The USD/CHF fell to 0.9903, but it returned to normal close to the level of its 200-day MA. As the joblessness rate went up, the AUD went down. It's the weakest currency of all. Rates remained unaltered between the Bank of England and the Bank of Japan. GBPUSD had a day to go, trading at the beginning of the NA session close the middle range.
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