Euro-Area Finance Chiefs Brace for Fresh Fight Over Budget

(Bloomberg) — Euro-area finance ministers will debate the final key elements of a small budget for their currency bloc, as the region seeks to cap two years of difficult negotiations over a tool that falls far short of the original sweeping vision of French President Emmanuel Macron.

The discussion on the budget, whose broad outlines were already agreed in June, will seek to bring to a conclusion difficult talks that pitted the fiscal restraint of the EU’s hawkish North against the South’s calls for spending to stimulate the economy. But entrenched differences over aspects of how this pot of money will be financed may mean an accord remains elusive.

The agreed budget would create a pot of about 20 billion euros ($ 22 billion) to facilitate investments and reforms and help give a boost to poorer nations, rather than help support economies in a downturn, as was initially intended. These funds, which would be part of the EU’s broader budget and distributed over seven years, will be used to help countries see through investments and reforms and help poorer nations catch up.

Proponents argue that the pared-down budget could still be a foot in the door that could evolve into something more powerful in times of crisis. Skeptics of the plan say it’s a toothless tool that could nonetheless help incentivize laggards to reform.

Stumbling Blocks

A key issue ministers will debate is whether the instrument can be financed entirely from the EU’s broader budget, paid in by all the bloc’s 28 governments, or whether it could be topped up by other funding sources in the future.

Countries led by France have been pushing for a deal that would allow funds to be added through further contributions. The Dutch and other fiscal hawks have pushed for it to be funded exclusively from the EU’s budget, a restriction that would limit its total size.

A compromise could include a so-called “enabling clause”, which would pave the way for countries that wish to top up the budget to do so in the future. But the Dutch have insisted that this would only be on a voluntary basis, a red flag for other members.

The other main issue to be discussed involves the details of the so-called co-financing rate, which determines how much money governments will receive from this budget for a project and how much they have to put up themselves. This contribution could vary depending on the member’s economic situation, being reduced during a downturn.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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Economy News

Pound Falls as Investors Brace for Brexit Fight in Parliament

(Bloomberg) — Follow @Brexit, sign up to our Brexit Bulletin, and tell us your Brexit story. 

The pound fell to the lowest level in two weeks as a showdown between U.K. lawmakers over Brexit loomed large.

Sterling was the worst performer among its Group-of-10 peers after Prime Minister Boris Johnson threatened to kick out Conservative lawmakers who vote to block a no-deal Brexit as Parliament prepares to return from holiday on Tuesday. The U.K. manufacturing sector shrank in August at the fastest pace since 2012, which also hurt sentiment.

“This move is a reaction to the news from the whips office that Conservative MPs could be expelled,” said Jane Foley, head of currency strategy at Rabobank. “That means even though the opposition will try and rush through this legislation to stop no deal it’s really not clear who will win.”

Bonds completed a fourth month of gains in August as investors braced for Johnson to suspend Parliament ahead of the Brexit deadline on Oct. 31, limiting the time available to prevent a chaotic exit from the European Union. Opposition lawmakers will present legislation Tuesday that would force the U.K. to delay Brexit again if an agreement hasn’t been reached.

The fell 0.6% to $ 1.2084 as of 10:56 a.m. in London, and weakened 0.3% to 90.71 pence per . The yield on U.K. bonds fell four basis points to 0.44%.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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Forex News

Cycling: Enraged Pinot ready to fight back on the Tour

ALBI, France (Reuters) – Thibaut Pinot is ready to use his rage to surge back into contention on the Tour de France as the race heads to his favorite terrain, the mountains. The Frenchman was the best placed of the pre-race favorites on Monday when he was caught at the wrong end of a peloton split in crosswinds.

He lost one minute, 40 seconds to slip down to 11th overall, more than two and a half minutes behind leader Julian Alaphilippe.

Defending champion Geraint Thomas, however, is in the driving seat in second place, just 1:12 behind the Frenchman and 1:21 ahead of Pinot.

During Tuesday’s rest day, Groupama-FDJ’s Pinot was still fuming at the positioning error that ruined his until-then perfect opening week, but he and his team vowed to bounce back.

“I feel frustration, I feel anger, I feel rage,” the 29-year-old Pinot, third overall in 2014, told reporters, his face a mask of cold determination. Making up for lost time on Thomas and his Ineos team mate Egan Bernal, who is only four seconds behind the Welshman, is a tough ask especially with an individual time trial that should favor the defending champion on Friday.

“Do not write our obituary,” team manager Marc Madiot said. “You’re going to see some outstanding Thibaut Pinot. His victory at the Giro Di Lombardia (one of five Monument classics last October) showed that he is a champion.

“His rage the other night shows that he can be a great champion.”

Madiot described Monday’s fiasco as “a blow to the liver”, saying his protégé was “1-0 down at halftime in a Champions League game”.

“We’re only midway through the race and, good for us, the hardest part is yet to come,” he said. After Wednesday’s flat 11th stage, the Tour will hit the Pyrenees, with a couple of tough climbs featuring in Thursday’s 12th stage and a mountain-top finish at the Col du Tourmalet on Saturday.

“I know that I have the legs. I can’t wait for Saturday, I have so much rage in me. The finish at top of the Tourmalet is going to hurt, the legs will do the talking,” said Pinot.

“We’re going to be aggressive, we have a team for that in the mountains,” he added, citing team mates Sebastien Reichenbach, David Gaudu and Rudy Molard. If the disappointment of Monday is not behind him yet, Pinot will use it for motivation.

“I’ve had some tough times in my career and I’ve always bounced back,” he said.

“I know that on the morning of the time trial on Friday and on Saturday before the Tourmalet stage, I will think of all this.”

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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Sports and General News

‘Equal pay’ fight resonates as New York fetes U.S. women’s soccer team

By Matthew Lavietes

NEW YORK (Reuters) – The U.S. women’s soccer team, fresh from its second-consecutive World Cup victory over the weekend, will return to Manhattan’s “Canyon of Heroes” on Wednesday to be honored by New Yorkers with a traditional ticker tape parade.

The squad’s 2-0 win over Netherlands in the final match on Sunday capped a World Cup campaign that attracted huge television audiences and bestowed celebrity status on Megan Rapinoe, the tournament’s top scorer and an outspoken team leader.

The victory also called attention to the team’s fight for equal pay with their counterparts on the U.S. men’s national team, and by extension, the issue of equal pay for equal work for women in general.

In March, all 28 players on the women’s team filed a gender discrimination lawsuit against the U.S. Soccer Federation, demanding their compensation equal that of their male counterparts.

“The level of interest and excitement is much higher from four years ago,” said Jessica Lappin, president of the parade’s organizers, Alliance of Downtown New York, referring to the 2015 parade for the team after its last World Cup victory. “That’s partly because they’re women’s rights icons now.”

The lawsuit alleges that women players each earn a maximum of $ 99,000 total for a season, compared with an average of $ 263,320 for male players.

As Sunday’s game came to a close in Lyon, France, the grandstands erupted with chants of “equal pay, equal pay.”

Parade organizers said they expected to hear a similar sentiment expressed loudly by the tens of thousands of people expected to line the parade route on Wednesday.

The parade will travel up Broadway through the heart of Manhattan’s financial district, from Battery Park to City Hall, a path dubbed “the Canyon of Heroes.”

At the end of the route, Mayor Bill de Blasio and other politicians will pay tribute to the team, while some of the players are likely to address the crowd.

Past honorees have included John F. Kennedy after his nomination as Democratic presidential candidate; Neil Armstrong and other Apollo 11 astronauts after their mission to the moon; and Queen Elizabeth II.

In recent decades, the city has hosted a much smaller number of parades and most of them have honored championship sports teams, including the New York Yankees and New York Giants.

Despite the name, today’s “ticker tape” parades are missing the real stuff – the ubiquitous strips of paper that ran through stock tickers that once provided price quotes for Wall Street traders.

Instead of ticker tape, about a ton of confetti made from shredded paper, tossed from about 20 buildings, will rain down on the team as they ride in open vehicles up Broadway, according to the Alliance of Downtown New York. Unlike in years past, most of the office towers along the route lack windows that can open.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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Sports and General News

Entries: To fight for every pip, or not?

Deciding how to manage your entries

Trading successfully can be quite a challenge. Interpreting sentiment, understanding the fundamental outlook for a currency, pairing it suitably with another currency, and then managing your risk are all hard enough. However, once you have done all that a key question still remains: when and where should you enter the trade? How do you manage the entry, so you don’t have to a) endure lots of drawdown and b) suffer too much financial pain if you are wrong? This article will consider when you shouldn’t be for fighting for every pip in your entry, and when you should be.

Times when you shouldn’t fight for every pip

Trading the squawk

There are definitely times in your trading when you should not be overly concerned with your entry price. There are times in trading when you want to be in as soon as possible. When might these occasions be? This is particularly true in trading headline news. For example, there has recently been a good deal of tradable news headlines on two key political and financial events; namely NAFTA and Brexit.

Now, when the news first came out in the squawk a couple of weeks ago that Mexico and the US had ironed out their disagreements over the NAFTA deal there was an immediate reaction as the Mexican Peso gained value. This would be an instant when you would not want to worry about your entry value, just get in as soon as possible, USD/MXN short. Similarly, when the EU’s negotiator Michel Barnier stated that he was prepared to offer Britain a deal with the EU, like no other country, the GBP rallied quickly. This was not the time to wait for a ‘perfect entry’, as the news was so significant that the GBP would rally for a good 50+ points. Not bad for a headline.

Trading surprise announcements

You have an interest rate announcement coming up for a central bank. The chances of a rate hike are seen as 2%, but then the central bank makes a massive surprise move and hikes their interest rates. This is the sort of time when you just enter in as soon as possible. In the chart below you can see when the Bank of Canada surprised markets with an interest rate hike CAD appreciated for the next few weeks on the back of that one decision. That is not the time to be concerned about a ‘perfect entry’, simply make sure you are in the trade. At first, this can seem hard, but overtime you develop a good understanding of which trades you just want to get in straight away.

Times when you should fight for every pip

Technical entries

Say, you are trading a currency pair in the Asian session. Perhaps you don’t want to be awake/at the screen during the session and you know that ranges tend to narrow during that session. Well, you might choose a currency pair that is unlikely to be affected by any Asian session news and try a technical bounce off a key level. In this instance you would want to make sure you set your entry very carefully, as overnight moves tend to be smaller and technical ranges come into play when there is no market news to move price in a strong direction.

When you want to be in, but not at any price

A recent example of when it would be appropriate to do this can be seen in the USD/CAD chart when there was a significant deviation for Canada’s CPI reading. It was expected to be 2.5% y/y and instead it was released as 3.0% y/y.Say you came to the chart and you saw that price had already traveled a long way from the news announcement. By drawing a fibonacci level on the chart you could have entered in at the 38.2% level and round number of 1.31000. In this situation you may not want to chase price, but instead ‘fight for your entry’. The only weakness with this approach is price may not retrace to your fib level and you may miss out on a potentially profitable trade.

When you correctly analyse a currencies direction, but it’s extended

Sometimes you will quickly analyse a currencies direction, but you will see that price is already heavily extended in one particular direction. In this instance, you don’t want to simply jump into the market as there is always a natural ebb and flow in price. Not every interaction with the market is due to speculators. There are many currency transactions that take place every day for a variety of business and government reasons. Staff have to be paid, currencies need to be converted, and balance sheets need to be adjusted. So, prices will often pull back in a trend. If you get into the habit of buying at any price, you make your risk of drawdown considerable. Also, you will have to use a large stop to allow for a normal technical pullback, say to a moving average. This is when you want to take an entry that allows for a reasonable, but not too large a stop.

For more on how to trade, check out our new forex education section and let us know what you think.

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