- Sterling rises as repeal bill passes first hurdle
- Aussie business conditions improve but confidence falls
- UK inflation awaited with interest
By David Johnson
Sterling strengthened early this morning after Theresa May’s government managed to get the Repeal Bill past its first reading with a majority of 36. That was not what the pundits were suggesting would happen and it starts the process of taking EU law into UK law to avoid the ‘law-free’ cliff edge when Brexit happens. A little bit of certainty was all it took to boost the Pound. This morning’s inflation data may well boost it a little more. A pick up from last month’s 2.6% to 2.7% or even maybe 2.8% is expected and that does start to pose questions for the Bank of England. However, the central bank believes these are short term issues and inflation will ease as we near the year end. Note though that anything above 3.0% in the inflation number will cause Sterling strength.
A report from Australia overnight showed that, whilst business conditions are perceived to be at their best levels since 2008, business confidence has dropped. Consumer confidence is a bit downbeat at the moment and we can see that feeding through into consumer demand. The Sterling – Australian Dollar rate rose and seems to be set for a target on A$1.65 in the short term, with A$1.67 a possibility if today’s UK data supports GBP confidence.
Let’s hope the UK data is interesting because there is not a lot of other data to keep traders busy today. We will have a speech from the European Central Bank (ECB) Vice President, Mr Vítor Manuel Ribeiro Constâncio. They probably schedule extra time just to announce him. His comments on the ECB’s monetary policy may well be enlightening but will certainly be watched with interest.
And researchers have been trying to work out the age at which men are least adventurous and most boring. I’m not sure why they were doing that but apparently 39 is that precise age. Before that we are supposedly adventurous and interesting and then after that age we become more exciting again. Can I urge each and every one of you to debunk this research. Bungee jump or wing walk or something this afternoon. Scuba dive or pot hole or something. Let’s not be pigeonholed.