QE takes the back seat with hope of a good run on the markets

30 September, 2013

Paul Newfield

Last week saw much bullish data releases in the UK, which greatly strengthened Sterling against both the Euro and the US Dollar, with increases of a cent and two cents respectively, come the end of trading on Friday. These rises were helped greatly by a selection of positive UK GDP figures, house price inflation levels of 5%, rather than 4.5% and most importantly Mark Carney, Governor of the Bank of England, utterly and completely throwing out the possibility of Quantitative Easing being pushed for the foreseeable future. The icing on the cake, for last week’s data releases, was confirmation that the UK economy rose 0.7% in the second quarter of this year; further indication that England’s rose may, just may, come into bloom once more. Not even the news that the Euro zone’s business activity growing at it’s fastest pace for two years, could throw the Pound off it’s climb to it’s highest peak against the single currency for over eight months. This week sees some important data releases for GBP, with mortgage approvals on Monday and one release of manufacturing or construction on Tuesday, Wednesday and Thursday, with no Pound-related data on Friday so we are unlikely to see Sterling push on through any further resistance levels unless poor statistics for the Euro zone come into play, for which, there is always the likelihood. Monday sees German retail percentages, with European CPIs at 10:00, followed by Canadian GDP at 13:30. At 14:45 we have US PMI information from Chicago. All of these data releases have some potential to weaken or strengthen the Pound against the Euro and the US Dollar. The Weeks other major announcements are as follows: Tues: AUD – RBA interest rate decision DEU – German unemployment rate/change USD – ISM manufacturing PMI Weds: EUR – ECB interest rate decision EUR – ECB monetary policy statement & press conference Thurs: Various – Markit services PMI Friday: JPY – BoJ interest rate decision & monetary policy statement USD – Nonfarm payrolls & unemployment rate It is potentially a very exciting time with optimism building for both the Pound and even for the Euro so stay in touch with your Currency Index trader if you are looking to send money abroad or repatriate cash from overseas – whatever the currency and wherever it is is being sent, you can rely on C.I.