Finally after a grueling 14 months of back & forth negotiations between the three countries – U.S, Canada & Mexico – came to an agreement on a trilateral accord which some of the financial commentators are also referring to as NAFTA 2.0, since the original agreement hasn’t really been scrapped simply renegotiated, but if you were to listen to Trump’s side of the story, it goes something like this…
There were some concessions on both Canadian & American sides with the former agreeing to open up their protected dairy market while the latter agreed to the conflict resolution mechanism – two thorny issues which were keeping them poles apart. Everything said & done Markets liked what they saw with the U.S index DOW closing up more than 200 points. It’s the first good news on the trade front in a while with the U.S-China Tariff war relentlessly keeping everybody on the edge. It remains to be seen if the current U.S Congress is able to ratify the new treaty before the midterm elections in November. Any bump in the process could rattle the markets again.
The biggest story in U.S equities last week was SEC’s decision to sue Elon Musk on his “irresponsible” tweets about taking Tesla private but this controversy ended pretty swiftly with an agreement between the two parties over the weekend. Musk was fined $20 million along with relinquishing of his Directorship at Tesla but gets to stay on as the CEO of his pioneering venture. The Tesla stock reversed sharply closing up 17%. For now, the news driven move seems to be over.
Forex markets saw some action as a result of the new USMCA agreement as well with both the Mexican Peso & Canadian Dollar rising sharply against the Greenback. Both the currencies had been incurring hefty losses ever since the trade agreement issue had gathered steam this year. Let’s take a quick look at the USDCAD pair which seems to be carving out a MT reversal with this fundamental move. The uncertainty that was keeping this pair bullish has subsided for now. The recent hike in Oil prices is magnifying the fall in the pair as well.
And finally in the Cryptoverse, it was Ripple (XRP) in the news. Ripple has led the most recent bull run in the digital coins but also has been the most volatile with the anticipation of the launch its much awaited banking payment solution xRapid which was finally released today. The new system is an upgrade to the present xCurrent system being used by more than 120 financial institutions around the globe. The pilot of xRapid was being used by MercuryFX and Cuallix who have reported a 40-70% transaction cost savings along with improvement in transaction speed from 2-3 days to just over 2 minutes. The current bull run has also seen it “flippen” Ethereum a couple of times. Let’s see how Ripple’s chart stands technically.
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