The latest US economic growth figures gave the markets some much needed good news to bolster the mood. The pace of GDP growth picked up in Q3 to an annualised rate of 2.0%, accelerating from the 1.3% recorded in the previous quarter. The composition of the growth, however, gave the markets reason to remain cautious about the next two quarters. The jump was partly due to a large increase in government spending. Federal government expenditures and gross investment increased 9.6% compared with the previous quarter, while national defence spending rose by 13%. The Commerce Department said there was also a rise in personal consumption, while investment spending and exports remain weak. The figures are one of the last pieces of important economic data before the US presidential election between Barack Obama and his challenger Mitt Romney on 6 November.
Lending to Britain's consumers rose at the fastest pace in more than 4-1/2 years in September and mortgage approvals for house purchase also beat forecasts, official data showed today. The figures boost hopes of a sustainable recovery in economic activity after GDP posted the strongest quarterly growth in five years between July and September -- partly due to one-off factors -- and follow official data showing that retail sales rose in September.
The eurozone took a step closer to becoming a ‘Federal State’ when ECB President Mario Draghi has backed German calls for a European super-commissioner to oversee national government budgets. German Finance Minister Wolfgang Schaeuble calls for Brussels to be given the power to dictate, as well as veto, nation states' national budgets. Plans to impose strict limits on budget deficits have already been agreed by 25 of the 27 European Union members. Only the UK and the Czech Republic have opted out of the German-led ‘grand plan’ for the euroland. This development makes an EU without Britain an increasingly likely prospect.
On the FX markets, Sterling rose to a three week high against the euro as expectations of more monetary easing in the UK reduced following the strong GDP data, hitting a high of €1.2490 before easing back early this morning. GBP/USD has made support following the generally bullish UK economic data currently trading around the 1.6080 level.
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Posted in Daily Market News on May 30 2014
Unemployment in Spain climbed to a new record high at 25%, a level unseen since the Franco dictatorship ended in the mid-1970s. The figure is a hair below estimates at 25.1% but higher than the previous 24.63%, confirming that the labour market in the Mediterranean country is even farther from...VIEW FULL ARTICLE
Posted in Daily Market News on Oct 26 2012 by alex