All Eyes On North Korea. Pyongyang’s missile launch over the weekend continued to keep market participants on edge, waiting to see whether tensions will escalate or if a diplomatic approach would be pursued. Meanwhile, South Korean President Moon Jae-in agreed with Trump in terms of stepping up their efforts to get North Korea to back down. In particular, the two leaders agreed to let South Korea fill its missiles with heavier warheads in case an actual strike does happen. Heightened geopolitical tension will probably bring a negative impact to the region’s economic growth, with tourism and the hospitality sector potentially impacted.
Safe Havens Continue Gaining Demand. Escalating tension in the North Asian region scared away many investors and triggered broad sell-offs in riskier assets on Monday. Risk-off vibes continued throughout the day as the lack of any other major updates kept the safe-havens ahead of the pack. Safe-havens like gold, the Swiss franc and the Japanese yen continued to advance, indicating that risk aversion remains in play.
British Pound Dips. Surprisingly, the pound chalked up some last minute losses for the trading session even as there were no reports released. Some speculate that this may be due to Norway’s $1 trillion sovereign wealth fund loading up on investments in the U.K. economy, with many believing that this might be a wrong move.
Watch Out Today For:
04:30 am GMT: RBA Interest Rate Decision
09:10 pm GMT: RBA’s Governor Philip Lowe Speech
By MEX Group Team