Morning Call

As expected, the Bank of England has left interest rates unchanged at 0.5% and asset purchases at £375bn. The full release from the BoE can be found here. @BankofEngland maintains #BankRate at 0.5% and the size of the Asset Purchase Programme at £375 billion — Bank of England (@bankofengland) December 5, 2013 The release at 12pm today, came during the Chancellor George Osborne’s Autumn Statement with the opposition still responding.…

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The media coverage of the housing market in the UK has been prominent since the economic crisis began in 2007. The global melt down began with mortgages being given to sub-prime borrowers, and then repackaged and sold as investment grade debt by banks and brokers. The property market in the UK ground to following the collapse of Lehman’s as banks tightened up their lending requirements and some home-owners were left in negative equity. Fast forward 5 years and there is a resurgen…

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The Federal Open Mark Committee (FOMC) left the potential for tapering to begin in December, stating “warrant trimming the pace of purchases in coming months.” The FOMC is walking a tight rope, as it attempts to soften the market impact of reducing its current level of quantitative easing. The Fed is attempting to signal to the market a vague timetable of tightening, without shocking investors. It is a difficult task, if they are too vague, then markets are left unsure, if the ex…

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The Bank of England Monetary Policy Committee voted unanimously to hold interest rates unchanged at the record-low rate of 0.5%, and the level of asset purchases at £375bn. Under the Banks forward guidance policy the focus had been on the unemployment level falling to the threshold of 7%. However this target was left in question following the BoE Inflation report with Carney, saying the bank might not raise rates immediately following a drop in unemployment. MPC Vote…

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The Bank of England governor Mark Carney’s comments during the latest inflation report on Tuesday. Prior to the news conference Sterling was bid on the back of the better than expected employment figures, which had traders predicting that the BoE would raise rates sooner than had been predicted. Under the banks forward guidance, 7% unemployment level had been the threshold, highlighted by Carney as the level that monetary policy would begin to be tightened. This was thrown in to…

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Forex Magnates London Summit 2013

On Tuesday, I was fortunate enough to attend the Forex Magnates Summit in London. The annual conference plays host to participants from all areas of the FX market including brokers, payment providers, technology vendors, prime brokers, prime of prime providers and liquidity aggregators. The conference is a two-day exhibition and conference, with different discussion panels. The industry specialists from high profile members of the FX community discussed current topics and issues.…

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UK ILO Unemployment beat expectations, coming in at 7.6% vs expectations of 7.7%. The number of unemployed people in the UK fell 48,000 to 4.27million. The Bank of England’s forward guidance; focused upon a headline unemployment rate of 7%. Today’s figure is a positive step towards this level, which potentially will see an increase in interest rates in the not too distant future. However one potential concern highlighted by analysts is the relatively stable hourly earnings…

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On Monday, there was further good news for the UK economy, as the Construction PMI was released at the highest level since 2007. The British economy is beginning to see sustainable growth following the economic crisis that began over 5 years ago. The positive macro data adds further pressure on Carney, that the Bank of England will need to bring forward the tightening of monetary policy. UK #construction PMI highest since Sep'07, = c2.5% q/q growth rate for sector & big GD…

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At 2pm ET (6pm London) the US Federal Reserve will release the interest decision and the FOMC releases its statement on monetary policy for October, following the conclusion of their two day meeting. In September the majority of market analysts had expected the Fed to begin to taper the current pace of bond purchases and beginning policy tightening. However the level of bond purchases was left unchanged, giving a bid to precious metals and a boost to equities in the US and Asia. It was…

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The Governor of the Bank of England Mark Carney spoke in Wales to discuss how he will attempt to address the regional economic imbalance. The issue has been a long standing problem, and following the collapse of the UK mining and manufacturing industries has only been exacerbated. Regional cities, which had grown on the basis of industry such as ship building, saw a rapid decline of living standards as the industries collapsed and unemployment took hold. In contrast the capital has a thrivin…

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On Twitter I got involved in a conversation about the regional disparity in property prices, and where the crisis had started. This then highlighted the similarities of the US sub-prime crisis and the current housing market and policy in the UK. @dlknowles @chakrabortty crisis started in estate agents in the US giving mortgages to sub prime borrowers.. — Joe Bond (@Joe_Trading) October 24, 2013 The subprime crisis began with as the housing market in the US was bubb…

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On Tuesday the US employment report, Non-Farm Payrolls was released for September. The highly anticipated number in September was released just over 2 weeks late. It still provided molality for traders, but the number perhaps didn’t have the same prowess as usual. Analysts were quick to highlight that it will be the October jobs report which should be affected by the government shutdown. The government shutdown began on October 1st so in theory, the September report shouldn&rsquo…

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At the eleventh hour the US Senate compromised to pass a bill, raising the debt ceiling and re-opening the government. The raise of the debt ceiling until early next year is a short term fix, for a much larger issue. The US government spends more each month than it raises in taxes, with the difference funded through debt. The political stalemate has meant the US government has had to shut down some services, as it neared running out of cash and being unable to meet its debt requirement…

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The US government has been in “shutdown” entering the 16th day, as the policitical stalemate continues. However late on Tuesday, it seems that an agreement had been made and the looming debt default will be avoided. Congress released an article on the 25th September that the US government would have exhausted their available cash, leaving approximately $30 billion as of roughly the 17th October. The CBO also stated that the government would be completely out of cash between…

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Chancellor George Osborne is part of a UK trade delegation to China, attempting to increase the business and investment links between the two countries. The China has growth figures that western countries could only dream of at the moment, and the UK is attempting to benefit from this in different areas: -Chinese students coming to the UK for education -Shopping and leisure -Large-scale investment projects -Export of UK luxury items -Relaxation of UK visa rules…

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