Stock markets have been steady overnight, with US index futures down slightly and the FTSE and Dax marginally higher. The biggest move was in the Hang Seng, which staged a 1.1% catch-up rally after underperforming last week.
This action feels like the calm before the storm, with several major political, economic and monetary developments on the way this week.
The spotlight in currency trading today is on the UK with the Brexit bill back in the House of Commons, with MPs are expected to vote on whether to accept or reject the two House of Lords amendments.
UK prime minister Theresa May could be set to trigger Article 50 as soon as today and if not, probably one day this week, while SNP leader Nicola Sturgeon is expected to deliver another call for a second Scottish independence referendum.
The US dollar is slipping back again today even though Friday's strong payroll and wage gains added to the case for multiple rate hikes this year, starting this week. The US dollar has been pricing in four hikes for several months now, and it appears some traders are taking profits against the news.
CAD, meanwhile, is gaining ground on USD despite a 0.8% decline in the price of WTI crude oil that usually would send the loonie lower. This indicates that the currency continues to benefit from Friday's very strong Canadian employment report, which showed a 100K gain in full-time jobs. Gold and JPY are also starting to regain their footing, but they also could be benefiting from increasing political risks.
A diplomatic incident between the Netherlands and Turkey over the weekend has the potential to give a second wind to Geert Wilders' euroskeptic Freedom Party (PVV), which had been falling in the polls. Wednesday's Dutch election has the potential to impact trading in the euro through the week.
There have been no major corporate announcements so far this morning.
Italy industrial production: (0.5%) vs street 3.2%
Japan producer prices: 1.0% as expected vs previous 0.5%
Upcoming significant economic announcements
9:30am (EDT): ECB president Mario Draghi speaks
There are no major releases scheduled for North America today.
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