- US President starting multiple trade fights
- Australian interest rates on hold
British shoppers bucked the trend and spent more in November than anyone forecast. When you adjust for the shifting black Friday event, the growth is just below 1% year on year. Sterling held its ground on the news but had already been knocked by poor manufacturing data released yesterday.
US President starting multiple trade fights
The UK wasn’t alone in that; global manufacturing data has been poor of late. That’s partly a slowdown in demand and partly the effects of the US v China trade tension. Aside from the US dispute with China, the US President is picking fights like an inebriated sailor right now. He is talking about tariffs on Latin American imports as well because he thinks these countries are deliberately devaluing their currencies. And he is threatening $2.4 billion of French products with tariffs. The French move is in response to France’s 3% tech tax, which disproportionately affects US companies and subsidies, which the US claims are still being used fror Airbus to compete with Boeing. To use the vernacular, it’s all kicking off.
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Australian interest rates on hold
We heard overnight that the Reserve Bank of Australia (RBA) held its base rate at 0.75% as was generally expected. With Australian data declining, there was an outside chance of a rate cut but t’was not to be. The GBPAUD rate sits just below A$1.90, as it has been for a few days.
Drop in South African economy expected
We are expecting a sharp drop in South African economic growth when their GDP data is released at noon (UK time). The forecasts are for something like 0.1% growth in Q3 after 3.1% growth in Q2. We can expect the Rand to weaken if the number is actually in the minus range. The GBPZAR rate could well end the day above R19
And the US president arrived in the UK today for talks with The Prime Minister, to meet the Queen and for various other meetings. He is being beseeched by Boris Johnson to stay out of UK politics. They’ll probably have to cancel his twitter account for that to happen. We shall see.