Week in a Glance: NFP, US stimulus, TikTok and Bank of England
The past week has been extremely busy in terms of news. Formally, the main event of the week was negotiations between Democrats and Republicans on a new stimulus package for the US economy. But since the parties did not reach a compromise at the end of the week, this event becomes the main news of the current week.
The Bank of England left the parameters of monetary policy unchanged and noted that it is not going to either soften them or even tighten them. The pound reacted relatively calmly to this. It is unlikely that it will succeed this Wednesday, when the data on the UK GDP for the second quarter will be published. The data promises to be devastating, which means the pound will be under pressure.
So, the deal for the first half of the week for us will be selling the British pound across the entire spectrum of the foreign exchange market. Even against the dollar.
The US dollar, which was under the most powerful downward pressure on Friday, rose rather aggressively. The reason for this was the US labor market data. NFP figures unexpectedly surpassed analysts' forecasts and exceeded 1.7 million. This, of course, does not mean that the crisis in the US labor market is over, but the correction in the dollar has matured a long time ago and the reason for its start is generally very good.
Trump's threats to block Chinese social networks TikTok and WeChat if they do not sell their American business segments to US companies can be considered an important event of the past week. As a result, TikTok is in talks with Microsoft. Such actions by Trump may well take tensions between the United States and China to a new level.
Meanwhile, the earnings season is fading. Despite the disgusting results for most corporations, they are still better than analysts' expectations, and as a result, the US stock market continues to grow. We have many times noted the irrationality of what is happening and the huge gap between the real world and prices on the stock market.
The Bank of England left the parameters of monetary policy unchanged and noted that it is not going to either soften them or even tighten them. The pound reacted relatively calmly to this. It is unlikely that it will succeed this Wednesday, when the data on the UK GDP for the second quarter will be published. The data promises to be devastating, which means the pound will be under pressure.
So, the deal for the first half of the week for us will be selling the British pound across the entire spectrum of the foreign exchange market. Even against the dollar.
The US dollar, which was under the most powerful downward pressure on Friday, rose rather aggressively. The reason for this was the US labor market data. NFP figures unexpectedly surpassed analysts' forecasts and exceeded 1.7 million. This, of course, does not mean that the crisis in the US labor market is over, but the correction in the dollar has matured a long time ago and the reason for its start is generally very good.
Trump's threats to block Chinese social networks TikTok and WeChat if they do not sell their American business segments to US companies can be considered an important event of the past week. As a result, TikTok is in talks with Microsoft. Such actions by Trump may well take tensions between the United States and China to a new level.
Meanwhile, the earnings season is fading. Despite the disgusting results for most corporations, they are still better than analysts' expectations, and as a result, the US stock market continues to grow. We have many times noted the irrationality of what is happening and the huge gap between the real world and prices on the stock market.
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