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December 2016

UK government borrowing unlikely to move GBP

Published: Wednesday 21 December 2016

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  • UK government borrowing unlikely to move GBP
  • Funds flowing from Euro to USD for improved yield
UK government borrowing data is due for release today and the forecasts suggest it will show an expansion of the Public Sector borrowing level. Opposition will seize upon the data as a vilification of poor government policy and the government will explain the data away but the Pound is likely to saunter past the release with the nonchalance of Maurice Chevalier in a top hat holding a glass of Champagne.
 
We will also see the Eurozone Consumer Confidence data this morning. We are expecting the figures to reflect marginally less pessimism that the previous month. Mind you, I doubt it will stop the flow of funds from the Euro into the US Dollar driven by the improved yield from US treasury certificates since the Federal Reserve’s interest rate hike.
 
Much later, we will get the New Zealand economic growth data, which should be in line with the previous 3.6% annualised number. That is way ahead of most other industrialised countries and the reminder of just how strong the NZ economy is may boost the Kiwi Dollar’s value overnight. Beware if you are a buyer of NZD.
 
That kicks off a slew of data ahead of the Christmas and Hanukkah break. Those releases include UK and US Gross Domestic Product (GDP) data as well as retail and inflation data from Canada. So there will be no respite for the markets as we count down the four more sleeps until Christmas.
 
Have a good Wednesday everyone. 
 

Marriage guidance


Counsellor:         So what do you believe has led to the breakdown of your marriage?
Wife:                     I just can’t cope with his constant Star Wars puns. He never stops.
Husband:             Divorce is strong with this one.

 

Today's Major Economic Releases
 

 
Market BST Data/Event Previous Expected
GBP 09:30 UK: Public Sector Net Borrowing 4.3b 11.5b
EUR 15:00 EU: Consumer Confidence -6 -6
USD 15:00 US: Existing Home Sales 5.60m 5.52m
USD 15:30 US: Crude Oil Inventories -2.6m -2.4m
NZD 21:45 New Zealand: Gross Domestic Product 0.9% 0.8%
NZD 21:45 New Zealand: Current Account -0.95b -4.89b
 

 
Christmas and New Year Opening Hours

 
Monday 26th December - Closed Bank Holiday
Tuesday 27th December - Closed Bank Holiday
Wednesday 28th December  8:30 - 17:30
Thursday 29th December 8:30 - 17:30
Friday 30th December 8:30 - 17:30
Monday 2nd January - Closed Bank Holiday
Tuesday 3rd January 8:30 - 20:00
Wednesday 4th January 8:30 - 20:00
Normal Opening Hours Resume

Daily Currency Analysis by David Johnson
 
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