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European Session – Euro tumbles to lowest since 2003; sterling falls after Bank of England

Posted on December 15, 2016 at 3:29 pm GMT

The euro fell to the lowest in more than a decade while the US dollar’s Fed-drive rally continued higher.  Meanwhile, sterling extended losses after the Bank of England meeting. The BoE Monetary Policy Committee voted unanimously to leave policy unchanged at 0.25%. It also voted to keep its asset purchase program unchanged. The target amount for gilts will remain at 435 billion pounds a month and corporate bonds at 10 billion pounds. The UK central bank stated that policy can [..]

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A brief take on the US dollar and the UK pound following Brexit

Posted on September 20, 2016 at 1:25 pm GMT

Brexit was one of the year’s key events, which caused quite a lot of volatility initially.  Looking at the currency market, it is worth revisiting some of the key recent fundamental influences for two currencies in particular; the pound and the US dollar. Starting with the pound, it is interesting to note that the initial shock devaluation that Brexit inspired was followed by some sideways action.  Bank of England stimulus hurt the pound initially, but stronger-than-expected economic data created some [..]

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Week Ahead – UK post-Brexit data to be closely monitored; dollar to tune into Fed minutes

Posted on August 12, 2016 at 1:31 pm GMT

The British pound will likely experience some movement next week, as one of the first major batches of post-Brexit economic data will be released.  Elsewhere, the US inflation report, some Fed speakers and the Fed meeting minutes and Japanese GDP growth for the second quarter, will all be closely watched by market participants. The week will get off to a slow start, with the first important indicator coming out of Japan on Monday in the form of GDP for the [..]

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Brexit is more similar to Grexit than most think

Posted on June 28, 2016 at 9:57 am GMT

  Nearly 1 ½ years ago in January 2015, voters in Greece brought the radical leftist SYRIZA party to power on the promise to do away with austerity while keeping Greece inside the Eurozone.  More recently, last Thursday British voters decided to abandon the EU in order to close their borders to free movement of European nationals and stop paying into the EU budget while keeping access to the Single Market for goods and services.  So there is a common theme in [..]

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Pound under pressure as Osborne tries to calm markets after Brexit win

Posted on June 27, 2016 at 11:28 am GMT

The British pound opened almost 2% lower against the dollar on Monday as currency markets reeled from the UK’s shock referendum result last Thursday to leave the European Union. The fallout from the British referendum vote is unlikely to go away anytime soon as the UK government as well as the opposition party find themselves in a deepening political crisis, which could complicate or prolong the UK’s negotiation to exit the EU. The UK’s finance minister, George Osborne, tried to [..]

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Asian Session – Pound extends losses but stocks attempt a rebound

Posted on June 27, 2016 at 8:16 am GMT

The pound resumed its downward path in Asian trading today following the UK’s referendum last week to leave the EU that led to the British currency plummeting to its lowest since 1985. Sterling was trading 1.7% lower against the dollar at 1.3435 in late Asian session, while the euro was 1.2% firmer at 0.8212 pounds. UK Chancellor of the Exchequer George Osborne spoke for the first time on Monday since Friday’s shock result of the EU vote. Osborne sought to [..]

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New uncertainties dawn on markets as “leave” wins in UK referendum

Posted on June 24, 2016 at 3:02 pm GMT

Having pretty much nearly priced in a win for the “remain” camp shortly after polls closed in the historic UK referendum on EU membership on Thursday, June 23, the flow of results during the night started to contradict this general view.  In volatile trading, the markets had the giant task of reversing their earlier judgement and price in the “leave” victory, which meant a huge sell-off in the pound and falls in the prices of risky assets.  The prices of [..]

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Asian Session – Sterling collapses as UK votes to Leave the EU; Stocks tumble

Posted on June 24, 2016 at 8:11 am GMT

Financial markets woke to the shock news on Friday that the UK had voted to leave the European Union in yesterday’s historic referendum. The final results of the referendum count showed 51.9% of the British public voted to leave the EU versus 48.1% who voted to remain. The surprise outcome is in contrast to an exit poll out yesterday that put the ‘remain’ camp in the lead. The pound tumbled to its lowest since 1985 as news started emerging that [..]

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Week ahead: Brexit referendum ends months of anticipation; Yellen testifies in Congress

Posted on June 17, 2016 at 2:20 pm GMT

The week ahead will be relatively quiet in terms of economic data, but the eagerly awaited UK referendum on EU membership is expected to unleash major bouts of volatility.  Prior to the referendum that takes place on Thursday, Fed Chair Janet Yellen’s monetary policy testimony on Tuesday and Wednesday will attract the markets’ attention. Starting from Japan, the country’s exports and imports as well as trade balance for May are due on Monday and they are expected to show a [..]

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UK jobless rate falls to lowest since 2005 as wage growth edges up

Posted on June 15, 2016 at 12:46 pm GMT

The number of people unemployed in the UK fell by 20,000 to 1.67 million in the three months to April, the lowest since the three months to May 2008. The employment rate was unchanged at a record high of 74.2%. There were 31.59 million people in work in the three months to April – 55,000 more than the preceding three months. The drop in the number of jobseekers pushed Britain’s unemployment rate to 5.0% in the three months to April [..]

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