Investor jitters ahead of Jackson Hole

Wednesday saw the pound make further gains against its major pairings as technical trading came into the fore as investors showed concern ahead of the Jackson Hole speech from Janet Yellen tomorrow.

A string of data for the US didn’t help yesterday as it all missed expectations, with mortgage data, house price figures and house sale data all came in lower than forecasters had hoped, giving way for the dollar to continue losing ground against both the pound and the euro. At the peak, the pound was a cent up and the euro ¾ of a cent against the greenback ahead of the start to the Jackson Hole two day meeting. Despite the losses yesterday, there is some expectations that Janet Yellen may give the nod to a further interest rate hike which would almost certainly give the dollar a significant boost.

Earlier in the trading day, German GDP had come out as expected at 0.4 percent for the month and 3.1 percent for the year on year figure. UK mortgage figures released a few hours later missed the expected reading of 38.500k compared to the actual reading of 37.662k, so it was a light relief to see the pound make further gains in addition to those made on Tuesday.

Today we will have to see if it can make a hatrick of gains while the markets digest Spanish GDP, Swiss industrial production, German IFO business sentiment data, UK CBI trades survey and a raft of US jobs figures and service PMI to name a few of the more key releases Stateside. Will the figures matter, or will sentiment be driving markets ahead of the key US speeches expected tomorrow. To find out, stay in touch with the Currency Index team.