Collinsonfx Daily Market Commentary

The US/China trade agreement is scheduled to be signed on Wednesday and promises much to markets. The resumption of 'normal trade' and supply lines have allowed markets to settle and equities to flourish. Markets have continued to prosper and hit record highs with great promise for the year ahead. There is no reason for this to change and the US Dollar continues to rally. The USD operates in a global environment that offers a premium in interest rates, that supports a strong Dollar and does not accurately reflect the risk profile. The EUR traded 1.1140, while the GBP slipped below 1.3000, hit by weak industrial and manufacturing production numbers.

Commodity currencies were static, with the AUD holding 0.6900, while the NZD traded around 0.6630. No major local data impacted, so the trade exposed currencies were victim to the reserve currency, while risk sentiment continued to improve. Geo-Political events remain a threat, although subsiding, allowing markets to focus on global economic data.

There is no reason not to support equities and the Dollar, in current economic conditions, although 'Black Swan' events remain a threat.