Pound rallies against EUR, USD
4 January, 2019
This morning sees sterling having gained ground of half of a cent against the euro and a cent against the dollar when compared to trading levels of yesterday morning. This is due in part to very underwhelming data releases from the US, with nothing of note from the eurozone, there was a correction in GBP-EUR as often happens after a quick sell-off from investors and a sharp slump in rates. Key eco stats from the US coming in below expectations were jobless claims and ISM manufacturing PMI inflation, down 5.2 points from the previous figure and 3.8 down on what was expected.
Back to Brexit and the latest vote is to take place week beginning the 14th Jan. However David Davis, the former Brexit chief, is said to favour Theresa May further delaying the vote to pile pressure on Brussels – most Tory MPs seem to favour a no-deal Brexit rather than the draft plan that May has put together. This despite fears from higher education leaders and Mr Gove the Environment secretary claiming that universities, farming and food produce will be hit hard by a no-deal outcome. Elsewhere Jeremy Corbyn, agreeing with new Brexit secretary Stephen Barclay, will resist backing another referendum, despite the majority of his Labour party calling for one. Irish and German ministers Varadkar and Merkel have spoken and both agree the draft Brexit deal will not be changed…
Today sees an opportunity for more significant currency movements as there is a huge amount of data to be released at the end of what is the first week of the new year. Nationwide have already published their house prices with MOM and YOY both down, another indication of the toil Brexit is having on property sales. Early doors and we have lots of inflation figures from the major EU countries and unemployment numbers from Germany. After, we have mortgage approvals and inflation from the UK, followed by EU inflation. The afternoon sees largely US releases including employment and earnings figures. Several speeches from Fed and FOMC members follow more US inflation figures. Keep in touch for the latest developments.
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