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Trump Diagnosis Leaves Markets Pondering Stimulus Chances

FOREX

An aggressive wave of risk-off early Friday on the breaking news of President Trump's COVID-19 diagnosis faded into the Friday close, with markets speculating that the illness could catalyze lawmakers into making a deal on fiscal stimulus sooner than previously expected. While JPY remained the strongest performer in G10 throughout, the gains faded as equities recovered and bounced back to flat.

GBP also firmed, with markets looking ahead to a scheduled call between UK PM Johnson and EU's Von der Leyen on Saturday. Talks have been extended into the coming weeks and markets clearly still see a decent chance of a last minute deal.

AUD, NZD and EUR were the weakest performers Friday, trimming the week's gains.

Focus in the coming week turns to the US ISM Services Index, RBA rate decision, FOMC & ECB minutes and the Canadian jobs report. Speeches from ECB's Lagarde, BoE's Bailey and BoC's Macklem will also draw focus.

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