Lack of Figures Keeps FX Relatively Unmoved this July Morning

 

USD

The U.S. Dollar remains in tight ranges in the absence of major data releases from any region. The news from the UK is pointing to the difficulties of Brexit negotiations, yet Pound continues to prevent its downfall.

There are still talks amongst some Tories in Parliament about the possible need to remove Theresa May from her Prime Minister role and the rejection yesterday of her plan to cover EU citizens in the UK by the EU commission shows that her plan of action is not working. Trade deals with the U.S. as Brexit is negotiated are also questionable in regards to favorable terms for both parties. 
With the Dollar staying range-bound, we shall see if any other major headlines cause fluctuation one way or the other. Oil prices rose this morning, but there is fear that if cuts are not deepened by OPEC, WTI Crude could fall well below $40.0/barrel by end of the year. Nevertheless, CAD and MXN have managed to gain recently against the greenback.

 

EUR

The Euro is currently sitting on its laurels, enjoying the lack of threats to its strengthening status. Traders are revising their outlooks on the shared tender; yours truly included, to account for the fading concerns over anti-establishment political parties winning seats in general elections.

Italy remains a bit fragile in comparison to other EU-bloc nations since its banking reforms have failed to pass. It is somewhat worrisome that now that the anti-EU Five Star Movement party has lost its momentum the up and coming political party is that of former controversy-packed media tycoon and Prime Minister Silvio Berlusconi.

 

GBP

Sterling is surviving in spite of growing problems in Brexit talks, including the crucial protections for EU citizens residing within Britain. At least now you are seeing some concessions from the UK’s Brexit team who agreed that the European Court of Justice could still be in charge of some aspects of British law as the divorce is processed. The political instability should sink the Pound, but once again a bit of an uptick on some economic indicator is keeping Pound afloat. This time, Retail Sales grew at a surprising annual pace of 1.2%.