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Brexit deal officially agreed on Sunday

USD: Corporates will have done their best to sort out Friday's FX requirements, if any, before the holiday. The only US economic data were Markit's provisional purchasing managers' index readings, which were as disappointing as those from Europe earlier in the day.  So all the components were in place for  a quiet day, and that is exactly what transpired. Oil and equity prices were under pressure but the USD was largely left alone.  

EUR: There was not much action in Euroland on Friday, either, once the mediocre PMIs had come and gone. The main focus of attention was on the meeting of EU leaders at the weekend, where they discussed Britain's withdrawal plan and Italy's budget deficit. Both aspects appear to have gone well. The other 27 EU leaders gave their approval to Theresa May's Brexit plan and there were signs this morning that Italy's coalition is willing to compromise on the budget front. The EUR is 0.1% firmer on the day against the USD.

CAD: Canada was the only major country to release any serious economic data, and they were not bad at all. The 0.2% monthly rise in retail sales might not sound much but it was double the size of the forecast 0.1% increase. As for inflation, an acceleration in the headline rate from 2.2% to 2.4% was accompanied by an uptick in the Bank of Canada's "core" measure from 1.5% to 1.6%. They were not storming numbers but they helped keep alive the prospect of higher interest rates. The CAD strengthened by 0.2%.

GBP: The UK government's progress in its negotiations with the EU was not matched by the progress of the GBP.  Having shot higher on Thursday following news of an agreement, sterling drifted through Friday as investors wearily conceded that the European Council is not the government's only interlocutor.  With the deal officially agreed in Brussels on Sunday there was not the slightest appetite for the GBP in the Far East and Europe this morning. Without the approval of Parliament the prime minister's deal is meaningless, and the signs are that it will not win that approval. And if not, then what?  Nobody has the faintest idea. The GBP is unchanged on the day.

JPY: With a loss of 0.3% to the USD the JPY was the day's underperformer.  Although there was little movement on Friday the JPY dropped a quarter of a yen quite swiftly on Sunday night. Ostensibly, the decline was the result of the below-forecast (51.8) Nikkei manufacturing PMI which preceded it.  Practically, that cause-and-effect feels unrealistic enough to suggest other market forces at work.

USD kicks back after Thanksgiving

USD kicks back after Thanksgiving

EUR gains traction from Italy optimism

EUR gains traction from Italy optimism

CAD slightly higher on sales and inflation data

CAD slightly higher on sales and inflation data

GBP flat despite government's Brexit deal with EU

GBP flat despite government's Brexit deal with EU

JPY loses ground following weaker PMI

JPY loses ground following weaker PMI

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