- The Pound appeared to find some support in trading yesterday with GBP/EUR hitting a day’s high of 1.0920 and GBP/USD trading as high as 1.2209. Those gains however were largely eroded late into the afternoon as Sterling came crashing back down into the Mid-1.0800’s and Mid 1.2100’s against the Euro and Dollar respectively.
- The recoil in Sterling rates appeared to coincide with the timing of comments made by Michael Gove.
- Speaking to Sky News yesterday Michael Gove, the Minister for planning for a no-deal Brexit, said he was ‘deeply saddened that the EU now seem to be refusing to negotiate with the UK’. Mr Gove added that a new approach was needed and that the Government remains ready and willing to negotiate but that the EU must know the UK are leaving on the 31st October with or without a deal.
- It is of course that no-deal rhetoric from the new Boris Johnson Government that has seen Sterling exchange rates plummet to recent lows.
- Speaking shortly after those comments from Gove, Irish PM Leo Varadkar said that whilst as time goes by a no-deal exit becomes more likely, he does not accept that it is unavoidable and he remains confident an agreement can be reached.
- US JOLTS Job Openings 7.35M (7.34M Exp)
- New Zealand GDT (Dairy) Price Index -2.6% (+2.7% Previously)
- According to US Federal Reserve Member James Bullard, a key member of the central bank, the Fed currently has interest rates set in the right area, but they should watch to see how the economy reacts to factors like the US-China trade war before making their next move.
- The Reserve Bank of New Zealand shocked markets and investors overnight by slashing their benchmark interest rate by 50bps, from 1.50% down to 1.00%. Economists had expected a 0.25% cut however the RBNZ went one step further, with Governor Orr stating that ‘Global economic activity continues to weaken demand for New Zealand’s goods and services’.
- The Kiwi Dollar plummeted in FX space following the shock cut, initially falling by 1.6% against the US Dollar before recovering slightly. However at the time of writing even the struggling pound is up close on 2% against the Kiwi Dollar.
- The sharp decline in the Kiwi Dollar has also impacted their close neighbours Australia with the Aussie Dollar also on the back-foot this morning.
- German Industrial Production m/m -1.5% (-0.5% Exp)
- French Trade Balance -5.19Bn (-4.0Bn Exp)
- Very little data set for release today.
||% Change on Day
||Fed Member Evans Speaks
||Consumer Credit m/m
Please follow and like us: