EncoreFX’s daily market updates are written by our experienced and professional dealing team.
By George Hopkinson
The US-North Korea Summit came to an abrupt end yesterday after North Korea demanded an end to ALL US sanctions if they dismantled the Yongbyon complex at the heart of the North Korea Nuclear programme. President Trump was not willing to concede and was quoted “Sometimes you have to walk and this was one of those times”. Both parties have lost some face and global markets showing a risk-off sentiment, ultimately putting pressure on the AUD.
Yesterday’s US data release showed the US economy expanded at a 2.6% annualized pace during the fourth quarter. The number came in above expectations therefore pushing US 10-year treasury yields to 2.71%; the highest level since early February. This data adds fuel to the possibility of a rate rise in 2019. – Dollar index chart is shown below
On this news the AUDUSD came under fire after stubbornly trading at 0.7140 leading into the data release. The USD strength and risk-off sentiment forced the AUDUSD below 0.7100 for the first time in 6 days.
Pakistan has released the Indian pilot they captured several days ago, easing heightened India-Pakistan tensions.
The pound edged lower on Thursday after this week’s run as investors booked profits and assessed the continued uncertainty about when Britain will exit the European Union and on what terms.
AUD under pressure today, support around 0.7070 level. Watch out for post summit tweets to direct today’s trading.
DXY Chart (Reuters)
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