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Sterling soars as US Dollar falls

Published: Friday 21 September 2018

  • Sterling clings on despite EU comments
  • Salzberg summit will be closely watched
​​By Joe De Berniere

The Pound climbed to a ten-week high yesterday, helped by US Dollar weakness and optimism about progress on a Brexit deal at an EU leaders summit. Sterling was up around 1 percent against the US Dollar at 1.3278 by mid-afternoon, while it climbed 0.3 percent against the Euro to 1.12891. A rally got under way early on Thursday after Cabinet Office minister, David Lidington, told Irish radio that the UK was “85-95 percent of the way” to agreeing a deal with the European Union on its exit. The Pound gathered more momentum with the release of retail sales figures, which beat expectations.  Although down from July’s 0.7%, they beat forecasts of -0.2% with a 0.3% reading.
Sterling clings on despite EU comments
Sterling held its gains throughout the day despite the ongoing discussions at the EU summit in Salzberg. Donald Tusk, head of the EU Council, said that Theresa May’s proposed new economic partnership with the EU will not work. He said the plans risked undermining the EU’s single market. May said her Chequers plan is the only credible way to avoid a hard border with Ireland, but reiterated that they’re making preparations in case no deal can be reached. Reacting to Tusks’s comments, David Davis and Jacob Rees Mogg both believe that puts the end to May’s Chequers plan and it’s time to go back to the drawing board.
Ones to watch
Today the focus for the markets will be on the European Purchasing Managers’ Index (PMI) figures in the morning, followed by Canadian retail sales data in the afternoon. Ongoing reactions to the Salzberg summit will also be watched closely, so it could be an interesting day...
Paraprosdokians… (Thank you Philip)
1. Where there's a will, I want to be in it. 
2. Since light travels faster than sound, some people appear bright until you hear them speak. 
3. If I agreed with you, we'd both be wrong. 
4. War does not determine who is right - only who is left. 
5. Knowledge is knowing a tomato is a fruit.  Wisdom is not putting it in a fruit salad. 
6. They begin the evening news with 'Good Evening,' then proceed to tell you why it isn't. 
7. To steal ideas from someone is plagiarism.  To steal from many is called research 
8. In filling in an application, where it says, 'In case of emergency', notify:  I put 'DOCTOR.' 
9. I didn't say it was your fault, I said I was blaming you. 
10. Women will never be equal to men until they can walk down the street with a bald head and a beer gut, and still think they look sexy. 
11. Behind every successful man is his woman.  Behind the fall of a successful man is usually another woman. 
12. A clear conscience is the sign of a bad memory. 
13. I used to be indecisive.  Now I'm not so sure. 
14. Nostalgia isn't what it used to be.  Nor is there any future in it. 
15. Change is inevitable, except from a vending machine. 
16. Going to church doesn't make you a Christian any more than standing in your garage makes you a car. 
17. Finally: I'm supposed to respect my elders, but it’s getting harder and harder for me to find one now. 
 18. I am not arguing with you, I am explaining why you are wrong.

Today's Major Economic Releases

Market BST Data/Event Previous Expected
EUR 09:00 EU: Flash Manufacturing Purchasing Managers' Index 54.4 54.4
EUR 09:00 EU: Flash Services Purchasing Managers' Index 54.5 54.5
GBP 09:30 UK: Public Sector Net Borrowing -2.9b 2.9b
GBP 12:00 Bank of England Quarterly Bulletin    
CAD 13:30 Canada: Consumer Price Index 0.5% -0.1%
CAD 13:30 Canada: Core Consumer Price Index 0.2% 0.2%
CAD 13:30 Canada: Retail Sales -0.2% 0.3%
CAD 13:30 Canada: Core Retail Sales -0.1% 0.6%
USD 14:45 US: Flash Manufacturing Purchasing Managers' Index 54.7 55.1
USD 14:45 US: Flash Services Purchasing Managers' Index 54.8 54.9

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