Sterling’s Sluggish Week
27 November, 2017
Sterling’s performance was sluggish last week as a lack of data meant there was little for traders to move on. This meant we traded within a 1 cent range for most of the week, although finishing on the back foot Friday as sentiment fell to the euro.
UK Data An Autumn Statement
The only real key UK data release for the UK was trade balance which showed a larger than expected deficit, of more than a billion pounds, plus the GDP figure, showing growth at 1.5 percent. The Autumn Statement from the Government, was as usual a fairly quiet event for the markets, but growth forecasts were downgraded, leaving sentiment firmly away for the pound.
Fed And ECB
The Federal Reserve last week confirmed their intentions to raise interest rates again in December, despite inflation continuing to be a concern. While various speeches were heard from ECB members over the course of the week, the general feeling is that they may be looking to bring a halt to the current QE program by the end of the year. This sentiment paved the way for the single currency to end the week on a high note, take nearly a cent from the pound and the same from the greenback.
The Week Ahead
As the month draws to a close, there is very little of note expected. For anyone sending money to Canada, there is a speech by Governor Poloz on Tuesday afternoon to bear in mind, while the UK undergoes a bank stress test that morning.
On Wednesday there is German inflation figures, while across the pond we see US GDP released. Thursday sees Swiss GDP and German retail sales and unemployment figures released early doors ahead of EU inflation, EU unemployment and after lunch US inflation.
As we see the start of December on Friday, we start to see the fresh release of PMI data kicking off with Markit manufacturing from the UK, EU and US and finally Canadian GDP
So likely to be sentiment led as we head through the week while Thursday and Friday are more data heavy, so might be worth tying up any trades early on to avoid likely volatility as the month comes to a close.
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