Sterling

The Swiss National Bank has reaffirmed their commitment to the minimum exchange rate of CHF 1.20 per Euro. “Consequently, the SNB will continue to enforce the minimum exchange rate with the utmost determination. It is prepared to buy foreign currency in unlimited quantities for this purpose.” There had been concern that a referendum (Save Our Swiss Gold) would leave the SNB unable to maintain the floor. The initiative was rejected by the Swiss people, which initially…

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Production data released by the Office for National Statistics missed analysts’ expectations. Manufacturing output had its lowest drop in 5-months, though it was pulled down by a fall in the production of computers. The ONS announced that manufacturing output was the only one of the four components of the Index of Production to fall. GBP Sterling was offered following the disappointing figures, trading down to print 1.5641. Cable has been trending in a choppy channel since…

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On Wednesday Chancellor George Osborne, was the main headline as he unveiled his Autumn Statement, and the reform of stamp duty on properties. As traders digested the announcements in Parliament cable was relatively unchanged. The figures on the deficit outlook were the most interesting Today Bank of England MPC concludes their two day policy meeting, and will announce at noon (London) if they have voted to change interest rates or asset purchases (QE). The consensus is for the majorit…

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At 12:30pm (London) Chancellor George Osborne will unveil his Autumn Statement at the House of Commons. This is one of the current coalition government’s few major announcements prior to next year’s general election, and an attempt to sway voters. This is a fiscal announcement rather than a monetary policy; which is overseen by the Bank of England. Osborne is under pressure as the current government announced a range of austerity measures during its term in parliament, on t…

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The second estimate for 3rd quarter UK GDP was released at 0.7% by the Office for National Statistics (ONS). The second estimate was in line with the initial release leading to a minimal weakening of GBP in the FX market. The annual GDP (between Q3 2013 – Q3 2014) grew by 3.0%, unrevised from the previous estimate. Though the release was a positive figure, the pace of growth has slowed, dragged by the trade balance. The slowdown of growth is a concern to investors that the UK eco…

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The Bank of England minutes for the MPC meeting held 5th and 6th November were less dovish than the market had expected with the split being the same as October. The MPC split was a 7-2 vote for interest rates to be left unchanged at 0.50%, with Weale and McCatherty voting for a 25bps rate rise. The committee voted 9-0 to leave the asset purchase (QE) programme at £375bn. GBPUSD Prior to the release of the minutes, sterling was offered to session lows around 1.5590, h…

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The Bank of England will release the Monetary Policy Committees minutes for the meeting on the 6th November. The MPC voted to leave interest rates at the record low of 0.50% and the quantitative easing asset purchase programme is £375bn. The announcement was as expected, with little effect to sterling in the FX markets. The October minutes showed the vote was 7-2, with the two dissenters being Ian McCafferty & Martin Weale. Traders will be watching today’s minutes for a…

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GBPUSD The USD has been strong across the board in recent months, as it has reasserted itself as the world’s reserve currency, with the USD Index up over 7% since the summer. Cable has trended lower since the beginning of July, trading from 1.7190 to print a new 12 month low of 1.5652 today. Is a 1.50 handle on the cards in the not too distant future, as Carney seems intent of pushing back the markets expectations of an interest rise, and the Federal Reserve looks to tighte…

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ONS data released at 9:30am, showed that the unemployment rate held steady at 6%, which was also accompanied surprisingly by an increase in wage growth. There were 30.79 million people in work. This was 112,000 more than for April to June 2014 and 694,000 more than for a year earlier. The Bank of England has held interest rates at the record low of 0.50%, with an emphasis on the economic slack, and more specifically the wage growth. These latest releases show improving employment condi…

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The Bank of England Monetary Policy Committee held their monthly meeting today and voted to leave the bank base rate unchanged at 0.50%, and the level of asset purchases (QE) at £375bn. The announcement was expected with minimal effect on Sterling in the FX markets. The minutes of the meeting will be released at 9:30am on 19th Novemeber, and offer further details as to the potential timing and the voting members. Press Release…

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Gold and Oil (Brent and WTI) prices have sold-off dramatically in the last two weeks, with spot Gold down over $100 since 23rd October. The US dollar has been strengthening across the board, as the Federal Reserve finishes its QE programme, with the Bank of Japan starting theirs. The multi-year lows for Gold and Oil, have picked up pace, with Gold down -$30 during today’s trading session. The Oil price tumbled following the unexpected move by Saudi Arabia, who cut the price…

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The Markit/CIPS UK Construction PMI survey was released at 9:30 GMT with weaker reading than expected of 61.4 vs 63.4. The figure is well above the expansionary reading of 50.0, though pace of growth was the slowest in 5 months. Cable weakened on the released, to trade back below 1.6000, with the USD stronger across the board. Press release…

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As Thursday, the day of reckoning for Scotland and its possible split from the United Kingdom draws ever closer, the debate reaches fever pitch with political, economic, celebrity and even Royal personnel voicing their views in the hope of swaying public opinion. This week, alone, we have heard from several obscure sources, ranging from the likes of David Beckham, Billy Brag to even the Queen herself who accidentally went against her previous better judgement of keeping quiet on the subject…

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The UK economy had been showing strong signs of growth and looked as if it was exiting the financial crisis faster than markets had expected. However the timing of the Bank of England’s rate rise has become the focal point of traders. Expectations vary by analyst though the median expectation is the first half of 2015, though there had been some belief the BoE might act before the year end. Sunday Times Interview This weekend the Bank of England Governor did an interview wi…

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