Pound Pares Gains, WAB Vote in Focus

GBP

The British pound drifted lower against rivals as market participants look forward to the Withdrawal Agreement Bill vote. The House of Commons speaker John Bercow has refused the government's request to have a meaningful vote on the Brexit deal. However, Prime Minister Boris Johnson is asking MPs to support him in two crucial votes. The first is the Withdrawal Agreement Bill vote which will ensure the deal struck in Brussels last week, and another vote on a timetable that will speed-up the Withdrawal Agreement Bill process to finish by Thursday night. Today's votes could lead to three scenarios: orderly exit, article 50 extension, and a general election. Pound pairs will remain exposed to any headlines concerning this matter. The GBPUSD is currently trading below the $1.30 handle, and the GBPJPY is hovering near 140.70.

USD

The dollar index, which measures the greenback against a basket of major currencies, finished marginally lower at 97.32 on growing optimism over trade between China and the United States. The White House Adviser Larry Kudlow indicated that the tariffs on Chinese goods scheduled for December could be canceled if talks go well. Moreover, President Trump expressed his optimism over reaching a trade deal. The recent developments could ease the downside risks to the economic outlook and buy the Federal Reserve more time before applying further monetary policy easing measures. The US 10-year yields climbed to a one-month high of 1.805%, the USDJPY rose to 108.72, and the EURUSD dipped to $1.1142.

Metals

Gold prices edged lower on enhanced risk appetite. Market participants are welcoming the recent Brexit and trade developments weighing on safe-haven assets. During the Asian session, the price of a gold ounce dropped to a one-week low of $1480, the price of a silver ounce declined to $17.43, while palladium hovered near $1770.

Oil

Oil prices continued to trade in a tight range awaiting fresh fundamental drivers. Market participants are looking for more clarity on the trade talks between China and the United States, which could enhance their appetite for risk. On the other hand, the American Petroleum Institute will report today the weekly US oil stock. The West Texas Intermediate crude futures fell to $53.29, and Brent futures dropped to $58.80.

Major Economic Events

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