EUR/CAD retreats to 1.4870 after reaching a fresh 6-month high, but despite the short-term retreat, the currency pair managed to find decent support just ahead of the 1.4860 mark.
After repeated warnings over the past few years, Turkey and Russia signed recently an agreement to increase the use of rouble and lira in cross-border payments, when Turkey signed to join the Russian alternative to SWIFT, the international telecommunications protocol used by banks worldwide, including central banks.
As part of the Turkish agreement, local banks and businesses will connect to the Russian version of the Swift system. Additionally, the infrastructure in Turkey should be improved so as to allow Russia introduce their MIR cards as an alternative to MasterCard and VISA in the country.
Apart from Turkey, Russia also signed agreements with China to strengthen trade between the two countries, and to increase the percentage of bilateral trade in yuan and rouble. The bilateral trade between China and Russia rose from $69,6 billion in 2016 to $107,1 billion last year. China is Russia’s largest trading partner both for imports and exports.
India’s participation in “the Russian SWIFT” is probable to be negotiated on BRICS summit in Brasil.
It is probable that dollar is getting weaker against EUR and CNY in the long term. According to BIS statistics, dollar was parity counterpart to about 82 % in nominal transfers in the beginning of the year. Unless the US politics rationalize, the situation will change in the short term.
Precious metals started the new of trading on a bullish note while US stock futures opened mixed on Monday following the Thanksgiving break. The volatility is expected to remain high this week, based on a list of important data and events. The ISM manufacturing PMI and the Core Personal Consumption Expenditures (PCE) Price Index may be the most market-moving events on the calendar this week.
In the past few weeks, oil prices have been under intense selling pressure. However, we see that oil prices successfully bounced back from the 4-month lows ahead of a highly anticipated meeting of OPEC-producing countries.
Global equity markets settled higher last week after cooling inflation reports raised hopes of an end to interest rate hikes. Moving ahead, with a shorter week with the market being closed on Thursday and a half-day on Friday for Thanksgiving. However, before the Thanksgiving holidays, some intriguing US data is scheduled to be published. Minutes from the latest November 1 FOMC meeting will be released on Tuesday.