Britain and the European Union came to an agreement on Brexit

Darnell Taylor
November 14, 2018

Early Tuesday action sees the GBP getting a relief bounce as the US Dollar pauses across the board, but a continued bull-run is looking unlikely unless today's United Kingdom earnings figures can distract investors from the notable lack of forward momentum on Brexit proceedings.

Prime Minister Theresa May will present the draft withdrawal agreement to her senior ministers on Wednesday for discussion and then decide on the next steps, her office said in a statement that confirmed several British media reports.

The euro meanwhile was down 0.9% at $1.1249, also around its lowest since June 2017.

The U.S. dollar surged on Monday to its highest point in 16 months against a basket of currencies and world stocks fell broadly amid concern about political risks in Europe, while U.S. and European technology shares were hammered. -China trade dispute has escalated, dipped 0.2 percent.

The euro's gain was limited by concerns about Italy's budget proposals and downbeat German investor sentiment data, traders said.

United Nations refugee agency cautions against repatriation of Rohingya Muslims to Myanmar
The Human Rights Watch also criticised Myanmar's de facto leader Aung San Suu Kyi over the forced return of the Rohingya. The U.N. refugee agency has already said that conditions in Rakhine state were "not yet conducive for returns".

The Australian dollar lost 0.4 per cent on the greenback to US$0.7194. U.S. equity futures are off their lows and Asian shares have recovered, which is why the yen is struggling so far but Treasury yields are lower as we begin the day and there are still some hints of nervousness ahead of the European cash equity market open - following Wall St's decline overnight.

Sterling leapt 1.4% to trade at $1.3036 against the dollar in afternoon trade, whilst against the euro it jumped to a near seven-month high of €1.1542.

The Italian budget issue continues to keep a lid on upside in the common currency, as the Italian government has until Tuesday to resubmit its budget plans and it doesn't appear that the government will rein back its spending plans, said MUFG.

"Italy is the big test case for the euro", said Joachim Fels, global economic adviser at PIMCO, at the Reuters Global Investment Outlook Summit in NY.

The tension between Rome and Brussels has raised fears about Italy's membership in the euro zone. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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