What kind of deal or no deal

26 June, 2017

Paul Newfield

Last week saw the Queens speech dominate the weeks’ proceedings, with several new laws and bills introduced, some relating to Brexit to help smooth the transition of leaving the EU. The Pound has flatlined and has traded within a half-cent margin against the Euro and the USD for the last four days, seemingly a lot less volatile but nonetheless remains critically weak, with almost no UK data releases last week to provide any potential boost to improve the negative sentiment sterling currently has – a not surprising state as all the sound bites coming from the UK negotiating team are all centred on whether the UK will get “no deal”, a “bad deal” or a “punishment deal”.

One small ray of light comes from Brexit secretary David Davis who has told the media that he is “pretty sure but not certain” that he can strike a deal with the EU over legislation to allow free trade with the rest of the continent.

Over to Europe then and Greece has had its bond rating upgraded by Moody’s from caa3 to caa2 and has also had its outlook improved from neutral to positive. Both of these happening after finally reaching a deal with bailout lenders for continued rescue fund payments. Italy also has some bailing out to do as it was announced the government will need to spend €5.2bn to save a couple of Venetian banks. Whether these two events will have any impact on the markets today will always be a distinct possibility.

A reasonably quiet Monday sees current climate and business conditions in Germany this morning, with UK mortgage approvals just afterwards at 9:30am. In the early afternoon are eco stats from the US in the form of durable goods figures and manufacturing business Index, followed at 22:45 by New Zealand’s trade/import/export figures. The biggest point is the Mario Draghi speech at 7:30pm.

Tuesday sees speeches by the big three of Draghi. Yellen and Carney. The outlook for the rest of the week is as follows:

US home sales at 15:00
US FED Monetary policy meeting at 16:00

GER consumer confidence survey at 07:00
UK consumer credit, mortgage approvals at 09:30
EU confidence, sentiment and climate at 10:00, 11:00
GER consumer inflation at 13:00
US GDP, expenditure, jobless claims at 13:30

UK consumer confidence at 00.01
FRA consumer inflation at 07:45
GER unemployment at 08:55
UK GDP at 09:30
EUR consumer inflation at 10:00
US expenditure at 13:30
CAD GDP at 13:30

With so much going on data-wise, particularly in the second half of the week, do keep in touch with your CI account manager to make sure you buy your currency at the best time possible and at the best price available on the live market.