Morning Update – 18/07/2017 – by Arjun Lakhanpal

Morning all.. Wall St had a quiet session with S&P closing flat on the day but the dollar remains weak. The markets are digesting the failure yet again of Trump to get a healthcare bill repeal.. Republicans in the U.S. Congress were in chaos over healthcare legislation after a second attempt to pass a bill in the Senate collapsed late on Monday, with President Donald Trump calling for an outright repeal of Obamacare and others seeking a change in direction toward bipartisanship. “Regretfully, it is now apparent that the effort to repeal and immediately replace the failure of Obamacare will not be successful,” Senate Majority Leader Mitch McConnell said in a statement. In FX we saw dollar weakness across the board. AUD, the highest performing currency against the USD overnight, made gains against the USD up 1.3%, trading at $0.7904 and reaching a two year high. This was off the back of the release of the RBA meeting minutes from Junes meeting which highlighted their economy was improving and estimated nominal cash rate is now 3.5% which they expect to rise again, this came in above market consensus. Australian 10yr treasury notes yields gained by 3bps to 2.757 after the release of the minutes. USD also weakened overnight against its peers after another two republican senators, Lee and Moran, came out to vote no to the Obamacare repeal bill bringing the total number opposing the bill to 4. EUR pushed through 0.5% higher to $1.15, reaching nearly a two year high and USDJPY dropped 0.5% to 112, all other crosses vs the USD were up ~0.3%. The strength in Asian currencies overnight pushed equities lower and the USD index continued to fall to a 10 month low trading at 94.779, down 0.4%. Oil prices stabilised after a last minute drop in prices before Mondays close. CNY reach an 8 month peak against the USD reaching 6.7597 in the onshore market. This morning we get UK CPI which is a potential market mover and German ZEW data.. Good luck.