I'm so thankful that the Brexit tedium is near its end, now if we can only put the US-China trade monotony in the rear-view mirror so we can all enjoy a high holiday season. Let's hope the US agriculture secretary Sonny Perdue was echoing Trump's sentiment when he suggested a reprieve for US taxpayers stating the December 15 tariff increase would probably not happen. Of course, we will have to wait for the solemnity of a Trump tweet for that actual confirmation.
In the meantime, the markets are very much in a holding pattern ahead of the significant risk events of the week, FOMC, UK election, and the December 15 tariff deadline.
China's November CPI and PPI were both stronger than expected, but there was a muted reaction in the market. Trade talk seems to be the only game in town, and presumably, they are still going on to try and get some semblance of a Sino-US trade deal before fresh tariffs get slapped on.
Gold Markets
Gold continues to see some soft haven demand in Asia, but interest remains low.
US consumers' inflation expectations rose slightly in November, bringing the outlook for near and medium-term inflation up from five-year low in the New York Federal Reserve survey., has probably kept the bid under gold in Asia.
Still, if anything today, t's been the focus on geopolitical tension in North Korea, which appears to be responsible for the small bid under gold. Indeed, following Trump's tweet over the weekend saying that North Korean leader Kim Jong Un was "too smart and had far too much to lose," it started a bit of a war of word. Now, the state-run Korean Central News Agency released a statement calling Trump "an old man bereft of patience."
The NK situation is little more than a tempest in a teapot, but the noise is likely adding to a touch of risk-off mood in Asia. But really in this time of the year, investors are more prone to take chips off the table, so even small risk wobbles are getting magnified when viewing through a de-risking lens and gold traders know this.
Overall gold remains steady but still on the defensive ahead of the FOMC where gold investors will be looking for support from the statement that could project an unchanged policy through the end of 2020
Currency Markets