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November 2017

US Dollar strengthens on better than expected growth figures

Published: Thursday 30 November 2017

  • US Dollar strengthens on better than expected growth figures
  • Pound gets welcome boost from restored Brexit negotiation hope
By Jonathan Russel
 
US Dollar strengthens on better than expected growth figures
 
The Pound and the US Dollar remain the two strongest currencies for the week. The USD was supported by better than expected Gross Domestic Product (GDP) data overnight, as well as Federal Reserve Chair Janet Yellen's upbeat comments.  The Senate voted to open the debate on the Republican tax plan yesterday, moving another step to a final vote, possibly today, or tomorrow. US President, Donald Trump, said in his usual tone in a rally in Missouri that it's a "once in a lifetime opportunity" and urged Congress to deliver. San Francisco Federal President John Williams also said "as long as the data continue to show steady growth and we see the uptick in inflation that we're expecting that we should continue to raise interest rates slowly over the coming year." The US Dollar remains supported.
 
Pound gets welcome boost from restored Brexit negotiation hope
 
Sterling rose across the board to levels not seen since September on Thursday, thanks to hope that some progress is at last being made in the torturous Brexit negotiations. The Pound strengthened following reports on Wednesday that suggested the UK’s “divorce settlement” from the European Union was approaching agreement. UK investors certainly welcomed this prospect, as Sterling climbed to 1.3479. Sterling has also garnered more support this morning as it appears that the UK government is close to a deal over the Northern Irish Border. British officials made proposals to avoid a hard border in Ireland, according to reports in the media. The Irish border is one of the three issues that need to be addressed before talks can move on to trade next year. For now, the Pound looks set to continue its rally.
 
A busy day for currency markets – key data to watch
 
Looking ahead, the calendar is very busy today. We have already had Swiss GDP, and still to come, the KOF Swiss Economic Institute report, providing key indicators for the strength of the Swiss economy. 
  • Germany will release its unemployment data.
  • In Europe, inflation and unemployment data are due.
  • Later in the day, the US Personal Consumption Expenditures (PCE) is the main focus, while Jobless Claims and Chicago Purchasing Managers’ Index will be featured.
#ThursdayThoughts

Happy St. Andrew’s Day to all our Scottish readers!

And it’s 1st December tomorrow and the First Day of Advent for many. Hope you have your Advent Calendars ready? There are some pretty innovative ones this year – I’ve seen versions with mini bottles of Champagne, gin, whisky, and all manner of teas, just to name a few interesting variations. All helps to get into the festive spirit, in more ways than one!

This is the time of year for contemplation and building excitement for the festive season ahead, so we’ll be sharing some fun things to see, read and do, along with some words of wisdom over the coming days and weeks.

So look out for your little treat each working day in our Daily Currency Insight, in the run up to the festive break…

Changing requirements
 
A group of old friends all turning 40, discussed where they should meet for lunch. Finally it was agreed that they would meet at The Red Lion because the barmaid was gorgeous and very friendly.
 
Ten years later, aged 50, the friends once again discussed where they should meet for lunch. Finally it was agreed that they would meet at The Red Lion because the barmaids were very welcoming and they sold real ale on draught.
 
Ten years later, at the age of 60, the friends again discussed where they should meet for lunch. Finally it was agreed that they would meet at The Red Lion because it was fairly easy to park in the car park opposite and they could have a nice drink in peace and quiet with no loud music and it was also good value for money.
 
Ten years later, aged 70, the friends discussed where they should meet for lunch. Finally it was agreed that they would meet at The Red Lion heath because it was wheelchair accessible and had a toilet for the disabled.
 
Ten years later, at the ripe old age of 80, the friends discussed where they should meet for lunch. Finally it was agreed that they would meet at The Red Lion because it looks nice from the outside but none of them had ever been there before.

Today's Major Economic Releases

Market BST Data/Event Previous Expected
EUR 09:00 EU: German Umemployment Change -11k -10k
EUR 10:00 EU: Consumer Price Index Flash Estimate 1.4% 1.6%
EUR 10:00 EU: Core Consumer Index Flash Estimate 0.9% 1.0%
EUR 10:00 EU: Unemployment Rate 8.9% 8.9%
CAD 13:30 Canada: Current Account -16.3b -20.0b
USD 13:30 US: Unemployment Claims 239k 241k
USD 13:30 US: Core Personal Comsumption Expenditures Price Index 0.1% 0.2%
USD 13:30 US: Personal Spending 1.0% 0.2%
USD 14:45 US: Chicago Purchasing Managers' Index 66.2 62.2

For more information, infographics and the latest currency insights, visit www.halofinancial.com/news