- BoE on hold - as in Sterling
- NZ confidence data mixed
- US retail sales awaited for Fed clues
There was a whole heap of minor data released on Thursday but the biggie was the Bank of England's interest rate decision. Hands up if you were surprised to hear the BoE left both the base rate and QE budgets on hold. Anybody............anyone........Bueller? I guessed as much. No one was surprised in the financial markets either but the BoE meeting minutes did show the Monetary Policy Committee was concerned about the depressed state of the oil market and a slowdown in wages growth and they are clearly in no hurry to raise the cost of borrowing in the UK. Sterling reacted by ...well...by not reacting really. The UK data diary for Friday is as empty as a political promise, so Sterling may well ease into the weekend with a whimper rather than a roar.
Overnight news from New Zealand showed business confidence; as shown by the Purchasing Managers Index, rose slightly in November. Two elements of that index; the new orders and the employment sectors were both at the highest since June. We also heard that consumer confidence fell a little. That kind of counterbalanced the business data, so the NZ Dollar stayed in tight ranges.
The rest of today is lacking major data apart from the US retail sales figures. This is one of the factors that may be weighing on the Federal Reserve's apparent willingness to raise the US base rate. There has been a distinct lack of momentum in retail activity but the forecasts are for an improvement in the core data and that would add to the expectation of a US interest rate rise next week. The Sterling – US Dollar rate which got as low as 1.48 last week, ran out of steam at 1.52 and looks like it may slip again even if it does hit the range top at 1.5250 briefly.
The sacking of South Africa's Finance Minister on the 10th December caused a sudden drop in the value of the South African Rand. It hit a new all-time highs against the Pound and other currencies and has continued to weaken this morning. There is a concern that higher US interest rates will strengthen the US Dollar and that will weaken the commodity markets – markets that South Africa is reliant upon for export income. For those who need to buy Rand, I can honestly say, you've never had it so good.
Have a great weekend everyone and just remember, there are only 13 sleeps until Christmas.
Major check up
A guy is feeling under the weather so he goes to the Doctor and asks for a complete physical examination. He's there for hours and after the Doc checks all the test results, he asks the chap to come back into the Surgery.
"I am afraid I have some very bad news," says the Doctor. "You are dying and you don't have much time left."
"Strewth," says the patient. "Exactly how much time to I have left?"
"Ten," says the Doctor
"Ten what? Ten days, ten weeks, ten months? What?" says the guy
The Doctor looks at his watch and says, "Nine....."