Sterling has managed to continue its gains yesterday following the UK PMI for manufacturing data showing a decent move into positive territory. This is the latest bit of positive data out for the UK economy and the news reduces the chance that the MPC will extend the QE measures at least for this month. The Chartered Institute of Purchasing, the company conducting the survey, found that manufacturers had increased their stock levels for the first time since November 2007 and had done so at a faster pace than at any point in the surveys history. One of the reasons mentioned for this flurry of buying was the fear of future inflation which makes a refreshing change from the fear of a double dip recession.
Overnight the Reserve Bank of Australia unexpectedly hiked interest rates by 0.25% to 4.75% giving a boost to the Aussie Dollar. Markets were generally expecting them to leave rates on hold especially following the poor CPI data out last week.
The USD has also seen a small boost from better than expected PMI results. The positive news has further muddied the waters of what the Fed should do at the meeting tomorrow with conflicting data for the US failing to show a clear route. Tomorrow night will definitely be one of the more interesting meetings of a central back that we have had recently and we will most likely see a bit of a drop off in volatility in the run up to the announcement as traders will not want to take the risk.
Posted in Daily Market News on May 30 2014
The Dollar has begun the week broadly weaker across the board as nervous investors continue to sell the greenback ahead of tomorrow’s FOMC meeting. In the scheme of things it is unsurprising. The near certainty expected by the market is that the Fed will extend in some form the Quantitative...VIEW FULL ARTICLE
Posted in Daily Market News on Nov 1 2010 by admin