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November 2017

Sterling bounces on possible Brexit bill agreement

Published: Wednesday 29 November 2017

  • Sterling bounces on possible Brexit bill agreement
  • USD weakened by oil ahead of Gross Domestic Product data
  • New Zealand business confidence rebound expected
By David Johnson
 
Sterling stronger on Brexit payout speculation
 
Sterling has bounced back to €1.13 and US$ 1.34 amidst rumours that the UK government has capitulated on the EU’s demands for a massive Brexit divorce settlement. Whether all is as it seems is another matter. However, traders displayed some level of relief and the Pound strengthened as a result. We will get UK mortgage and credit data this morning and they ought to show a slight slowdown in debt. With the recent rise in interest rates, that should come as little surprise, but beware of the figures beating the forecasts. A 25 basis point rise is small enough to encourage people to act before the rate gets higher. 
 
US Dollar weakens on oil restrictions
 
The US Dollar was weakened by news that some of the oil producing nations are going to restrict supply for an extended period. That strengthens the oil price and weakens the USD because oil is traded in USD. This afternoon brings the US economic growth data, plus consumer spending data as well. An upward revision in US Gross Domestic Product (GDP) growth could wipe out any losses the USD suffered yesterday. So USD buyers may wish to cut their risk by trading this morning. Later this afternoon we will get a speech from the Chair of the US Federal Reserve and later still, we will get sight of the Federal Reserve’s Beige Book. A busy afternoon is in prospect for the USD.
 
Will New Zealand business confidence improve?
 
Overnight tonight New Zealand will release its business confidence index. That was really bad last month at -10.1; a very pessimistic result. We expect a rebound of sorts, but the strength of that rebound will be the key to the New Zealand Dollar’s performance overnight.
 
Yeti another hoax…
 
And the scientists at the University of Buffalo in America are a bunch of killjoys. They have used DNA tests to prove that bones and other materials, originally believed to be from the Abominable Snowman; Yeti to its mates, are in fact from bears, dogs and other animals. Science is the bane of all mystery, isn’t it? 
Keep up

A Police officer pulled a car over and walked around to the driver’s window. “Good Morning,” says the officer. “Do you know the speed limit on this piece of road?”

“No,” says the driver.

“Well it’s 40 MPH”, says the policeman, “but you were going much, much faster than that, weren’t you?”

“I was just trying to keep up with the traffic,” says the driver.

“The policeman looks up and down the road, which is empty as far as the eye can see. “I can’t see any traffic,” he says.

The driver sighs and says, “Yup. That’s how far behind I am.” 

Today's Major Economic Releases

Market BST Data/Event Previous Expected
All  All Day The Organization of Petroleum Exporting Countries Meetings    
GBP 09:30 UK: Net Lending to Individuals 5.5b 4.3b
GBP 09:30 UK: M4 Money Supply -0.2% 0.3%
GBP 09:30 UK: Mortgage Approvals 66k 65k
USD 13:30 US: Preliminary Gross Domestic Product 3.0% 3.3%
GBP 13:00 Bank of England Governor Carney Speaks    
USD 15:00 Federal Chair Yellen Testifies    
USD 15:00 US: Pending Home Sales 0.0% 1.1%
USD 19:00 US: Beige Book    

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