The markets have traded in a tight range during the Asian session but Europe has started with a bang.
GBPUSD is already trading 100 pips lower than 2 hours ago on speculation that the imminent Article 50. However, Scotland is looking for a new independence vote in 2018 or 2019. Hence, the pressure for a weaker Pound is expected to persist for now. GBPUSD traded as low as 1.2123, a 1- month low, after having posted 1.2250 highs yesterday.
US equities ended mixed overnight with Dow Jones closing down -22.5 pts, or -0.1% at 20881.48. S&P 500, on the other hand, gained 0.87 pts, or 0.04%, to close at 2373.47. This comes ahead of ahead of the string of central bank meetings this week (US, UK, Japan and Switzerland due this week).
Dollar strength means GOLD weakness so the yellow metal has been under pressure and trades down at $1201 from $1210 yesterday. Support lies at $1198 and $1194.
Elsewhere in Europe, the Netherlands’ general election would be held on March 15. With fractured political environment, no party is expected to gain a majority. EURUSD trades at 1.0640 after having stalled at 1.0705 following the NFP relief rally which saw the EUR reach a 1-month high.
The Australian dollar was down 0.15 percent at $0.7561, giving back some of the previous day’s gains made when the dollar stumbled against the euro.
The Trump administration’s fiscal 2018 federal budget plan will be released on Thursday, and G20 finance ministers and central bankers meet in Germany on Friday.