12th September 2017 Market Update
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?? GBP – Yesterday there was no economic data of note released from the UK. However in the evening the EU repeal bill won its first commons vote, where the government was bidding to extract the UK from EU law prior to Brexit. The fact there were no obstacles has allowed Sterling to maintain its relatively strong position against the euro and dollar. Sterling/euro is currently at its strongest level since 17th August.
Today CPI data is being released from the UK. This is expected to be higher than the previous reading of 2.6%, and will place further pressure on the Bank of England to increase interest rates. A higher reading could see Sterling strengthen.
?? EUR – Yesterday was very quiet for the Eurozone with no headline data until the end of the week. Industrial Output from Italy was better than expected and although it did not cause market movements, it adds to the consensus that the Eurozone is increasingly prosperous. The euro lost ground against both Sterling and the US dollar yesterday.
Today again sees a lack of economic news from the Eurozone and so the euro could again be vulnerable to movements outside of its control which may see it weaken further.
?? USD – There wasn’t any data of significance from the US yesterday, and there will not be any today either. PPI is being released on Wednesday, and will be the next piece of high impact data from the US.
09:30am – CPI, PPI Input and RPI
Our View: Sterling seems to be holding and adding to the gains it made last week ahead of the crucial interest rate decision from the Bank of England on Thursday. With Eurozone data increasingly positive across the board, the euro still seems to be in the box seat however.
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