Here is this week's Game Plan:
The only news from the weekend wasn't on Brexit. The US/China trade dispute was still very much alive at the APEC summit on Saturday, suggesting little prospect of consensus. Watch risk assets, although the Trump/Xi meeting at the end of the month will be much more influential. The Pound will likely remain under pressure as PM May will have to face a confidence vote on Tuesday perhaps. At the time of writing, only 21/22 letters (of the 48 required in order to challenge PM May) have been officially noted so there really isn't anything substantial yet.
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Themes for the Week:
- Brexit Mess: PM May could face a no-confidence vote on Tuesday, and she also has to get her Brexit plan approved by Parliament. After key resignations last week, it seems difficult that she will succeed.
- US/China trade jitters: the APEC summit did nothing to resolve the tension between the 2 parties. Will Trump be able to deescalate tensions with Xi at the G20? His comments certainly suggest it's possible, and have recently aided risk assets (EM & global equities, base metals, Aud & Nzd).
- Crude Oil: we all know that Crude Oil is a key component of inflation expectations, so it wouldn't be a surprize if the recent dovish talk from Fed speakers was due the big drop in Crude. We'll see just how far this goes. For now it remains on everyone's radar.
- UK inflation report hearings
- RBA Minutes
- OPEC Meeting
- ECB Minutes
- CAD CPI & Retail Sales
On the Radar:
GBP remains volatile and I only suggest touching it if you're plugged into a news squawk all day long. Any rogue comment can spur intraday volatility in either direction. It's potentially simpler to get aboard the US/China theme via AUD or NZD vs USD or Euro...and yes for the temerary GbpAud and GbpNzd are the intraday vehicles of choice. Crude Oil remains a sell if we can breach 56.00 once again.
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