Tomorrow, it is expected to storm in the foreign exchange market, whereas today is calm, which is facilitated by a day off in the US (Thanksgiving Day). Note that the trading range of the EUR / USD pair on Friday is usually almost 200% more than on Thursday, while for GBP / USD, it increases by an average of 180%. Moderation is characterized by a jump in volatility for a pair of USD / JPY.
The most heavily affected at the beginning of the week currencies scored more on Wednesday than others. The rise led the Australian and New Zealand dollars, having won back a two-day fall. Macro-statistics is not to blame, both currencies followed the yuan on reports that the Central Bank of China may reduce incentives in 2019 if economic growth slows down slightly. The Canadian became calmer after the stabilization of the oil situation. The main currency pair EUR / USD rebounded from the 20-day SMA, ending the session below 1.14.
Tomorrow will be important for the euro and the Canadian dollar, as it is expected to publish releases on business activity in the euro area and on inflation and retail sales in Canada.
The British pound remained under pressure, as there was a risk of cancellation of the special summit of the European Union at the end of the month on the issue of the UK leaving the group. German Chancellor Angela Merkel is committed to ensuring that an agreement is reached in the coming days. At the moment, the difficulty lies in the fact that Merkel's colleagues intend to add additional conditions to the agreement. Interference is created by Spain, which refuses to support the Brexit deal with future trade agreements involving Gibraltar. According to the British Prime Minister, Gibraltar should be included in the treaty, and this could be another serious obstacle in the negotiations.
Theresa May is now busy receiving support in her own government, and the Brexit deal at this time is on the verge of being disrupted by the EU, which will be a serious obstacle for the UK. Thus, the clouds that regularly thicken over the sterling will not go anywhere until an agreement is reached. The risk of "hard" Brexit increases every day.
