(29 AUGUST 2018)DAILY MARKET BRIEF 2:US deal fails to support peso

As the gongs sounded of a US-Mexico trade deal, broad USD selling slowed while Mexican peso rose, yet MXN was unable to hold high ground. While the downside risk of a failed agreement has decreased, confusion has increased. For now, risky assets and emerging currencies are attractive, but ultimately they will need yield support.

Trump is hailing the Mexican agreement as the biggest trade deal ever. Canada has returned to the table, saying the door is open for agreement. Markets immediate reaction was of optimism, sending the S&P 500 to a new all-time high.

By Peter Rosenstreich