Good morning,
We start the week off a bit more data focused, as early European PMI figures have given the Euro a slow start, losing about 0.2% against the USD and 0.15% against the GBP.
UK construction PMI’s will follow this morning at 09:30 which may allow the Pound to continue its pursuit of the 1.16 threshold.
Christine Lagarde will make her first public speech as ECB president, in which markets will dissect in order to get an idea of her monetary policy stance, an important factor as the baton has been passed with a caveat of disagreement internally around the huge stimulus package initiated.
For the Pound, although the news radar is likely to be heavily monopolised by the upcoming General Election on December 12th, markets will be factoring in the Bank of England November Monetary Policy Report, as any sway towards a more Dovish stance may support further pricing in of a rate cut 2020.
Elsewhere, we saw South Africa take a win not just in the Rugby World Cup, but in avoiding a credit downgrade by Moody’s, keeping its investment grade status for now, and instigating a relief rally in the currency. This may well have provided the necessary warning for Economic reform.
Have a great week ahead.
Ross Hammond, Senior Corporate Account Manager