The US$ has pared some early European losses in a day of consolidation on Monday, after Republican leaders in the US Senate had found enough votes to approve a stopgap funding bill that will end the current government shutdown. Overall though it has been a day of consolidation and most pairs are currently pretty much where they were yesterday, although the Yen is under some pressure, as the funding currency of choice, as risk sentiment improves. The other mover in the currency markets was Cable which saw good demand into the London fix and then made new post Brexit highs after comments from the French President, Macron, who hinted that a bespoke Brexit deal might be able to be arrived at, which might include a deal on the financial services sector. Elsewhere, the news of resolve in the US Senate did stocks no harm either, with both the S+P and the DJI heading to new all time highs. As with the dollar, the metals and WTI have been mostly choppy but rangebound, finishing the day pretty much unchanged.
The main event today will be the BoJ meeting, with traders waiting to see what Kuroda has to say although no change is expected to Monetary Policy. Later in the day it will be the turn on the German/EU ZEW Economic Sentiment Survey to provide the direction but there is little else to come from either the EU or the US, and it would seem that political headlines will be the main driver on Tuesday. Have a good day.
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