· The dollar held firm against its rivals on Friday, set for its first weekly gain since mid-December on optimism about talks to end the trade war between China and the United States.
Media reports on Thursday and Friday suggested both countries were considering concessions ahead of a Washington visit from Chinese Vice Premier Liu He on Jan. 30 and 31 for talks aimed at resolving the trade standoff between the world’s two largest economies.
U.S. Treasury Secretary Steven Mnuchin discussed lifting some or all tariffs on Chinese goods and suggested offering a tariff rollback during the trade discussions scheduled for Jan. 30, the Wall Street Journal reported on Thursday, citing people familiar with the internal deliberations.
Although a Treasury spokesman denied Thursday’s report, the positive sentiment was enough to lift the dollar index and the three major U.S. stock indexes Friday morning. Following the publication of the Bloomberg story on Friday, the dollar index added to its gains rising 0.3 percent, last at 96.352.
· The pound weakened on Friday as investors took profits after a stellar rally that set the currency up for its biggest weekly gain against the euro in more than a year on growing confidence that a no-deal Brexit can be avoided.
The pound has risen about 1.3 percent against the euro EURGBP=D3 this week, set for its biggest weekly gain since December 2017.
At 1540 GMT, the pound was down 0.65 percent at $1.2895 GBP=D3, having touched $1.30 on Thursday.
On Friday, prominent Brexit campaigner Nigel Farage said the United Kingdom is likely to delay Brexit and another referendum is possible.
May is due to hold a series of meetings with some of her top ministers on Friday to discuss the way forward after her deal with Brussels was rejected by parliament, her spokeswoman said.
· Jeremy Corbyn, leader of Britain’s opposition Labour Party, will reiterate on Monday his willingness to talk to Prime Minister Theresa May on ways to break the deadlock over Brexit but not while the government wastes money on “no-deal brinkmanship”.
After seeing her deal to leave the European Union resoundingly defeated in parliament last week, May has opened talks with lawmakers from all parties to try to find a way to move forward with Brexit.
She is due to return to parliament on Monday to outline her plans, but with just weeks before Britain is due to leave in March and little concrete yet to have come out of those talks, some lawmakers are trying to wrest more control over Brexit.
· As America's longest-ever government shutdown continues, federal workers face an uncertain financial future.
About 800,000 US federal staff are at home or working without pay during the political deadlock over funding for Mr Trump's proposed border wall.
· U.S. President Donald Trump proposed an immigration deal on Saturday in a bid to end a 29-day partial government shutdown, including temporary protections for “Dreamers” and other immigrants, but Democrats immediately dismissed it.
Insisting on his demand for $5.7 billion to fund a U.S.-Mexico border barrier as part of any bill to fully reopen the government, Trump sought to pile pressure on Democrats by appealing to immigrants they have tried to help.
In a speech from the White House, Trump offered three years of protections for young undocumented immigrants known as “Dreamers,” as well as for holders of temporary protected status (TPS), another class of immigrants.
But the protections he proposed fell far short of the path to citizenship for Dreamers that Democrats and some Republicans in Congress have been urging for years.
Democrats insisted talks on border security occur only after the government is reopened. Senate Democratic Leader Chuck Schumer said, “It was the president who singled-handedly took away DACA and TPS protections in the first place. Offering some protections back in exchange for the wall is not a compromise but more hostage taking.”
Even before Trump spoke, House of Representatives Speaker Nancy Pelosi said his offer as reported in advance was “unacceptable,” did not “represent a good-faith effort to restore certainty to people’s lives,” and was unlikely to gain the votes needed to pass the House or the Senate.
· China is expected to report on Monday that economic growth cooled to its slowest in 28 years in 2018 amid weakening domestic demand and bruising U.S. tariffs, adding pressure on Beijing to roll out more support measures to avert a sharper slowdown.
Analysts polled by Reuters expect the world’s second-largest economy to have grown 6.4 percent in the October-December quarter from a year earlier, slowing from the previous quarter’s 6.5 percent pace and matching levels last seen in early 2009 during the global financial crisis.
That could pull 2018 gross domestic product (GDP) growth to 6.6 percent, the lowest since 1990 and down from a revised 6.8 percent in 2017.
· Oil prices hit a roughly two-month high on Friday, rising with the stock market, on news that China has put forward a plan to eliminate its trade surplus with the United States.
U.S. West Texas Intermediate crude futures ended Friday’s session up $1.73, or 3.3 percent, at $53.80 per barrel, the best closing price since Nov 21.
International Brent crude oil futures were up $1.50, or 2.5 percent, at $62.68 per barrel around 2:30 p.m. ET. Brent earlier rose as high as $63, its best intraday price since Dec. 7.
Both benchmarks are up about 4 percent this week, posting a third consecutive week of gains following a three-month collapse in oil prices.
Reference: CNBC, Reuters, BBC
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