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Obama’s victory offset by weak data

The Pound was trading in the 1.5700 region but looked stronger in the 1.6200 area again with weak ISM and jobs data while stocks plummeted in the US. However, the US was not isolated and the UK also suffered further losses on the share markets and weak Factory PMI leaves the pound in the 1.5900 region again, ahead of the rate decision out later on today. The interest rates in the UK are widely expected to be cut by 50 basis points, but the big questions is that if its going to be enough?

The Euro is strong amongst the majors but perhaps Trichet might have something to say in his press conference after the ECB decide on whether to cut interest rates now or not. He has commented that they "may do" which is virtually means they will, but a lot will depend on Trichet's rhetoric and prospects for the Euro zone looking forward.

The Yen is still strong on risk aversion and the AUD is feeling the strain from the long lived carry trade being unwound and declining interest rates.

Gold is weakening as commodities including oil drop whilst bonds rise and inflation outlooks are dampening.

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