19th July 2017 Market Update
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🇬🇧 GBP – Inflation data released in the early hours of UK trading showed a fall to 2.6%. This caused the pound to fall in value across the board, as the probability of an interest rate rise decreased.
Britain’s Brexit negotiator David Davis was grilled by the media this week for appearing to turn up to the negotiating table with no notes or paperwork. Although this seems insignificant, journalist will be looking for any hints as to each sides hand.
Bank of England Governor Mark Carney gave a short speech revealing the new £10 note hours after the inflation reading came out, however there was no mention of the fall in inflation in his report.
🇪🇺 EUR – German economic sentiment fell for the third consecutive month, however still remained in ‘optimistic territory’.
No data to be released for the euro area today, however with Brexit negotiations expected to progress this week markets will be keen to pick up on any hints.
🇺🇸 USD – Further evidence that Trump wields little political power and backing by his own party showed yesterday, as his pledge to ‘repeal and replace’ Obamacare was dropped by the Republican Party – which was a major election promise in his campaign. Whilst the bill is not completely off the cards, the dollar could come under pressure in weeks to come as much of the strength in the greenback followed Trump’s somewhat business friendly policies.
Building permit data to be released this afternoon from across the pond, with an expectation of a slight rise in the figure. This shows some resilience in the housing market, coming at a time when demand for housing would be expected to fall, as interest rates and housing demand are inversely related.
13:30 – Housing Starts – Expected to rise to 1.15m
13:30 – Building Permits – Expected to rise to 1.2m
02:30 – Unemployment Rate – Expected to rise to 5.6%
Our View: With housing data to be released from the US we may see some movements in the market, however unless there are any major surprises we may have a flat day across the board.
Brexit negotiations could cause some movement, however markets will most likely await David Davis’ return tomorrow before making any moves.
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