The news that the chief negotiator from China invited American colleagues to hold new trade negotiations, supported the euro in the morning and reduced the tension that emerged earlier this week after Donald Trump said Beijing deliberately slows down and drags out negotiations, refusing to make concessions.
As it became known today, a telephone conversation took place in which Liu He, who heads trade negotiations with Washington, invited US Trade Representative Robert Lighthizer and Finance Minister Stephen Mnuchin to Beijing. The American side expressed its readiness for a personal meeting, which allows counting on progress in the negotiations and the signing of its first phase. However, White House representatives also noted that the meeting can only take place if China makes it clear that it is ready to assume the obligations set forth in the trade agreement regarding the purchase of agricultural products, as well as with the protection of intellectual property and technology transfer. The Chinese side expects the aforementioned meeting to take place next Thursday, which is due to Thanksgiving in the United States.
As for the fundamental data, in the morning there was only an index of sentiment in the business circles of France, which showed growth to 100 points in November this year against 99 in October, indicating positive changes. Economists predicted that the index would remain 99 points in November.
The report, which was published today by the Organization for Economic Cooperation and Development, clearly coincides with the expectations of many economists and experts in this field, and therefore the reaction to it was corresponding. According to the data, the OECD no longer expects acceleration of global economic growth until 2021, and this is directly related to the escalation of the trade conflict between the US and China, which can only complicate the situation in the global economy.
Global economic growth is expected to be 2.9% in 2020 and 3% in 2021. The OECD previously forecast global economic growth in 2020 at 3%. In this regard, economists have urged countries to engage more actively in fiscal policy to support growth.
US GDP growth is expected to slow down to 2% in 2020 and 2021, and China's GDP growth is projected to slow down in 2021 to 5.5%. The German economy will generally show growth of only 0.4% in 2020 against the latest forecast of 0.6%. The resolution of the US trade conflict with developed countries, including China, of course, will support the global economy, returning it to its former path of development.
As for the technical picture of the EURUSD pair, the bulls again failed again and failed to break above the resistance level of 1.1090. However, the bullish scenario can still be realized after it is possible to overcome this maximum. This will continue the upward correction to the area of levels 1.1110 and 1.1140. However, the probability of a downward correction should not be ruled out, since a break of the major support of 1.1050 may push the pair even lower and return it to the lows of 1.1020 and 1.0990.
GBPUSD
The British pound is gradually strengthening its position against the US dollar, but the growth is quite moderate, as traders are waiting for the publication of the election manifesto of the British Labour Party, which will attract new voters to its side. Reducing the advantage of Conservatives, of course, will negatively affect the position of the British pound, which is growing on expectations that the Tory party will get a majority in the elections scheduled for December 12 this year, and British Prime Minister Boris Johnson will be able to withdraw the country from the EU under an agreement that he agreed at the end of this summer.
The data on the number of borrowings of the UK public sector were of no interest to anyone. The report indicated that growth amounted to 11.2 billion pounds in October against 8.9 billion pounds a year earlier. Economists predicted an increase in borrowing from the UK public sector in October at 9.2 billion pounds. The public sector's net cash requirement fell by 0.7 billion pounds in October from -4.2 billion pounds a year earlier.
As for the technical picture of the GBPUSD pair, the buyers regained the resistance of 1.2935, which now acts as a support, which could positively affect the further strengthening of the trading instrument. Bulls are aiming for new highs around 1.2980 and 1.3020. The downward correction will be limited by the large level of 1.2890, which was formed yesterday.
