By Simon Eastman
Last week ended with sterling remaining buoyant against most of its major pairings, helped in the main by poor German data and a lack of releases from elsewhere.
The German GDP figure year-on-year dropped further into negative territory than had been forecast, at minus 0.4 percent, whilst the IFO institute released various readings concerning business sentiment, which give a key indicator as to the state of the country’s future economic strength. All three readings, including the prominent Business Climate figure, came in under forecast and lower than the previous month’s readings, which led markets to sell off the single currency in sterling’s favour.
Given we had no UK data to go on, we saw only a slight improvement from Thursday’s rally, which saw a dip in afternoon trade, so the pound was coming from behind, but finished slightly higher than Thursday’s peak, matching the top of the recent range we have seen the pair trade in over the past couple of months. Canadian retail sales beat expectations after lunch on Friday but that did little to move the Loonie higher against the stronger pound.
Below we look at the week ahead, as November closes off and we enter the quieter trading month of December, where trading is often thinner and we can see markets dictated by traders closing positions for year end and more volatile conditions as a result. We outline the main releases for the week below and would urge anyone with a house completion expected in December or early 2024 to contact us early.
As a well known fizzy drinks maker starts to remind us, “the holidays are coming” and with that, all important deadlines need to be managed correctly. Bank transfers and clearing can take longer so make sure to organise any requirement sooner rather than later. Get in touch with the team at A Place in the Sun Currency to discuss your requirements and get a currency strategy in place to ensure your completion goes to plan so that it’s just the party fizz that causes you hiccups and you can focus on the other important things at this time of year.
The week ahead
Monday – US new home sales
Tuesday – AUD retail sales and speech from RBA governor Michell Bullock, speeches from Bank of England members David Ramsden and Jonathan Haskel, German Good for Knowledge consumer confidence survey, US house price figures, consumer confidence reading and speeches from three Fed members.
Wednesday – New Zealand interest rate decision and policy statement, EU business climate, consumer confidence and economic sentiment survey, German inflation, US GDP and Bank of England governor Andrew Bailey speech.
Thursday – German retail sales, OPEC meeting, German unemployment, EU inflation, US inflation, Canadian GDP, various central banker speeches.