19th April 2017 Market Update
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?? GBP – A surprise speech from Theresa May yesterday at 11:15am, caused the pound to strengthen across the board, seeing highs we haven’t had since the end of last year.
With the PM calling for an early general election on the 8th June, markets are predicting that this will give strength to Theresa May in the
House of Commons and therefore, in Brexit negotiations initially.
There is very little data out until Friday so Sterling moves will be dictated by any further commentary, with regards to the election.
?? EUR – With no significant data for the euro yesterday it was at the mercy of external data.
The only bit of data for today is the euro inflation data which is predicted to stay the same at 1.5% which shouldn’t affect the markets too much, however any opinion polls coming up from the French election could cause more movement.
?? USD – Similarly, there was little data out from the US, with industrial production data released. This was released, as predicted at 0.5% and did not affect the rate.
Today’s key data for the USD is the Fed’s Beige Book, which could show an insight for potential interest rates in the future. This could affect the dollar depending on the outcome.
2.00PM – Fed’s Beige Book.
6:45PM – CPI Figures, expected to rise to 0.8%.
Our View: With a shortened trading week, the pound has acted strongly to Theresa May’s speech yesterday, gaining against the euro and dollar. With no stand out data across the board, the pound should keep these gains throughout the rest of the week. If we receive any more geo-political data from North Korea and USA, we could see more sterling strength as a safe haven.
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