20160524 – DAILY FX COMMENT

  High Low     High Low
EUR/USD 1.1228 1.1204   USD/ZAR 15.81 15.65
GBP/USD 1.4500 1.4473 GBP/ZAR 22.90 22.66
EUR/GBP 0.7752 0.7729 USD/RUB 67.90 65.80
GBP/EUR 1.2938 1.2900 USD/ILS 3.8750 3.8568
USD/JPY 109.47 109.16 S&P 500 2050 2044
GBP/CHF 1.4365 1.4317 Oil (Brent) 48.93 48.35
GBP/AUD 2.0166 2.0032 Gold 1252.0 1243.0

Honestly it has been a pretty “quiet” week fundamentally and economically.

There have been a number of FED members speaking this week (Presidents Bullard and Williams last night and Board Governor Jerome Powell on Thursday) and clearly they are preparing the financial markets (albeit dependent of US economic data to reinforce their decision) for a US rate hike in June. I have noted previously that with the US elections in November, July was in all probability the “cut off” for a US rate hike pre elections. So it would appear the FED are likely to strike while the iron is hot and get the hike out the way, or else risk having to commit political suicide and hike ahead of the elections in September or November (a no no!!). That would leave potentially 2 hikes for 2016 (June and December) which was not on the FED’s agenda if you remember back in December. They were hoping for 4 hikes in 2016, however with the US economy chugging along and China in all sorts of trouble, it looks like they (the FED) will have to settle for 2 hikes in 2016. You can argue, 2 is the best they can hope for under the circumstances. The FED though will be hoping the economic data over the forthcoming 3.5 weeks warrants such a move. The NFP number earlier this month certainly did not impress (+160k) so clearly the FED will be hoping for a rebound on the 3rd June in conjunction with Retail Sales, inflation, Wage growth and Industrial Production. Here is a something to mull over, what if China GDP and economic data shows further signs of deterioration and contraction (and they devalue the CNY) – can you see the FED pulling the trigger? Oi vei!!

The USD has as a result of the increased likelihood of a rate hike enjoyed a rally vs the EUR, AUD, GBP (though that’s mostly EU referendum based) and JPY (from her recent lows). You can see from the table above, the FX markets have been pretty quiet and tight overnight as traders cite a lack of data and incentives to prompt another round of USD buying. That is not to say it won’t come as we get closer to NFP (3rd June) and FED Chair Yellen’s speech on 6th June. Clearly the FX market is being ultra-cautious and trying to pip the market rather than hit a home run. Not worth throwing your annual budget out the window when things are as unclear as they are. Kinda like jumping into the waters surrounding Seal Island (Gaansbaai, Cape Town) when visibility is down to a couple meters. Trust me I should know, and it was scary (yes I was in a cage).

The GBP – honestly what more can we write. It is starting to get ugly now with both sides throwing wild accusations at each other. Mr Boris and your followers, you have made some solid arguments but why don’t you answer this question (one we have posed many times and I bet you can’t answer), FX traders have confirmed should the UK vote to leave the EU, the GBP will devalue at least 10% (potentially to 20%) leaving UK citizens 10-20% worse off when travelling and 10-20% poorer as prices rise to counter the fall in the GBP. In fact only yesterday the CEO’s of Tesco, Sainsbury’s, M&S and B&Q all issues a stark warning that shop prices will rocket and prove “catastrophic” for families. The article in the Daily Mail also mentioned there would be an increase in inflation, job losses and ultimately an increase in the UK base rate to counter the plunging GBP. IS THAT WHAT YOU/WE WANT? Honestly do you really want to see you net income fall 20% at the drop of a hat!! I certainly don’t. I will leave it at that, I think I have said it all. Boris and Michael if you are reading this, please can you reply, thank you.

 

 

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20160523 – DAILY UPDATE

PRICES

With the politics surrounding the EU referendum in the UK heating up, the government – specifically the Treasury – continues to issue reports about the negative impact of Brexit on the UK economy. As much as the ‘Leave’ campaign rants about bias, the government is not the only one at it. Some of the top British high street bosses have also come forward to discuss the negative impact of Brexit, here’s the link.

 

According to Eric Rosengren, a member of the FOMC, the US is close to meeting the criteria that would justify a rate hike in June. The conditions the Fed set are:

  1. i) Additional signs of a rebound in the US economy
  2. ii) Further strengthening in the jobs market
  • iii) Inflation trending towards the 2 percent target

 

It’s worth noting that Rosengren, the president of the Federal Reserve Bank of Boston, has historically been a hawk, so it’s important to observe that he is becoming more hawkish. The Fed minutes published last week have resulted in a narrow majority of economists polled by the Financial Times now anticipating a hike in June. 51% of the 53 respondents now say the FOMC will announce a hike in June.

 

Standby for some more of the Greek debt saga. The IMF and the EU (or should I just say Germany?) are at loggerheads over whether Greece needs debt relief or not. The reality is that Greece needs debt relief, even German officials privately accept this. At 180% of gross domestic product, Greek’s public debt is unsustainable, it’s the dirty little secret of the Eurozone, but… and here’s where it gets tricky, in order to sell the bailout agreement last year, German politicians described the bailout as a loan. If they are now forced to write some of that debt off, it becomes a de facto transfer which is something the German electorate never signed up for. It’s going to be very interesting because Chancellor Merkel’s position after the Syrian immigrant crisis is not what it was last year. I’m not sure they’ll be able to wriggle their way out of this, and the great lie will be revealed to all. This will all feed into volatility for the euro in the months ahead. This fits in neatly to the technical view we have of a downward pressure on EUR/USD in the months ahead.

 

At the moment we continue to be in a consolidation or holding pattern, with the odds greatly in favour of dollar strength when trends re-assert themselves.

 

 

 

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20160520 – DAILY UPDATE

PRICES

Signs of growing dollar strength are increasingly evident. USD/JPY is trading above 110 now and if I’m right and this move sees the currency pair trade into the 130s, Japanese stocks just might be a steal at these levels! That said, it’s the chart for EUR/USD which looks very illustrative to me. Look at how it’s traded through support in the last few days.

20160520_eurusd

This week we’ve seen weaker than expected inflation in the UK, but better than expected British retail sales; much better Q1 GDP growth data in Japan as well as better than forecast machinery orders data also in Japan. Even consumer confidence in the US is improving relative to previous data. You have to say the good news has outweighed the bad, and it’s pertinent because of what the last FOMC minutes reveal. It is clear that policy makers will be prepared to take hawkish action in June if the data supports it. Ok so most of the data I’ve mentioned hasn’t been for the US, and it’s reasonable to assume that the Fed will be far more focussed on their domestic economy. But let’s not forget that the externalities have been a concern for the FOMC in recent meetings. It does look like that’s going to be less of a concern now, and the US economy has been pretty solid for quite some time. The bottom line is that I think stronger US data will give the dollar a boost between now and the next FOMC meeting in June.

 

 

 

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20160519 – DAILY FX COMMENT

Good morning

  High Low     High Low
EUR/USD 1.1230 1.1205   USD/ZAR 15.94 15.79
GBP/USD 1.4607 1.4564 GBP/ZAR 23.27 23.06
EUR/GBP 0.7704 0.7679 USD/RUB 57.15 65.52
GBP/EUR 1.3023 1.2980 USD/ILS 3.8598 3.8398
USD/JPY 110.39 109.92 S&P 500 2047 2038
GBP/CHF 1.4429 1.4386 Oil (Brent) 49.23 48.24
GBP/AUD 2.0266 2.0151 Gold 1261.0 1252.0

YESTERDAY certainly proved the storm was brewing. I mentioned yesterday my inner thoughts on the UK EU referendum and what would happen should we STAY or GO. Late yesterday afternoon a survey was published showing the REMAIN camp has opened an 18 point lead over the LEAVE camp which immediately saw the GBP rally in the FX market. Spot GBPUSD rallied from circa 1.4425 to over 1.46 at one stage while GBPEUR rallied from 1.28 to trade just shy of 1.30 as I write this comment. That was one heck of a rally and has given the REMAIN camp a real boost. I sincerely hope that survey remains in place ahead of and on the day of the referendum.

In yesterday’s comment I mentioned the FED minutes were being published last night. Some VERY INTERESTING points to be made from the minutes. I wrote yesterday that I was of the opinion that the FED will be looking to hike at the latest (if at all) in July given the US elections in November. I also mentioned that Chair Yellen has noted several times that the hike is dependent on the “recovery” in the US economy as well as growth in China. Chair Yellen and her colleagues noted it would be appropriate to increase FED funds in June “if incoming data were consistent with economic growth picking up in the second quarter, labour market conditions continuing to strengthen, and inflation making progress toward the Committee’s 2 percent objective.” FOMC members also noted that the slowdown in the US economy in Q1 was temporary and furthermore they smoothly omitted Chinese growth issues from the statement as those risks have somehow (really?) diminished since their last meeting in March. Perhaps I have been reading different economic data from China J

Suffice to say the market is now pricing in a 32% chance of a hike in June and potentially a double whammy increase in both July and December as well bringing the total rate rises for 2016 to 0.75% and thus taking the FED funds to 1%. As per my comments yesterday, the FED better be wary of a continued slowdown in China so as not to derail the US recovery. I honestly do not see what the big rush is to raise US rates, as I would prefer to see global economies begin to turn together and show healthy gains in GDP. Surely the last thing the FED want is to get to December having hiked to 1% and China’s GDP continues to lag and fall below the psychologically important 7% mark. We know for a fact that corporate investment has fallen in recent months as CEO’s remain cautious on global growth and thus prefer to remain on the sidelines before committing to hiring and investment.

So I continue where I left off yesterday regarding my view on the USD and GBP. I think the USD will continue to rally towards the psychologically 1.10 barrier while the GBP should remain buoyed by the positive outcome in the upcoming referendum. GBPEUR for those travelling to the EU in the summer should therefore continue to rise to that magical 1.35 rate I mentioned yesterday. Here’s hoping!!

 

Have a good day

 

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Opinions expressed are subject to change without notice and may differ or be contrary to the opinions or recommendations of ParityFX. Unless stated specifically otherwise, this is not a recommendation, offer or solicitation to buy or sell and any prices or quotations contained herein are indicative only. To the extent permitted by law, ParityFX does not accept any liability arising from the use of this communication.

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20160518 – DAILY FX COMMENT

Good morning

  High Low     High Low
EUR/USD 1.1317 1.1265   USD/ZAR 15.77 15.51
GBP/USD 1.4467 1.4423 GBP/ZAR 22.76 22.40
EUR/GBP 0.7823 0.7810 USD/RUB 65.34 64.10
GBP/EUR 1.2804 1.2783 USD/ILS 3.8386 3.8040
USD/JPY 109.39 1.09 S&P 500 2050 2041
GBP/CHF 1.4198 1.4155 Oil (Brent) 50.02 49.35
GBP/AUD 1.9860 1.9712 Gold 1282.0 1271.0

CALM BEFORE THE STORM. The “mighty” Pound continues to trade sideways with both the REMAIN and LEAVE (the EU) camps pitching the pro’s and con’s. While there are arguments to be had in favour and against each camp, the facts are simply undeniable. Remaining IN the EU offers the UK access to over 500 mio people and the ability to export and import freely. The UK economy is dependent on this trade and should the UK electorate decide to LEAVE and go it alone, be rest assured, financially we will be worse off. The IMF, BoE, World Bank, FED, ECB and even the US President cannot all be wrong. Should the UK leave the EU, prices will rise just like it happened when the EUR was born. I remember clearly travelling throughout Europe on business trips the costs of a simple cup of coffee. Prices rose by 10-20% as companies hid the increases when the EUR currency was adopted. Wages on the other hand remained static. As I have written and noted previously, should the UK leave the EU, the GBP will devalue by 15-20% and with it you will see local products that have foreign (imported) parts rise the same. Wages on the other hand will not rise by the same amount and therefore (you do the maths) your basic income will fall by the same amount. Is that the legacy you want to leave for your kids? I think not. In fact today sees the publication of Average Earnings and the statisticians/economists are calling for a rise of 1.7% (below the 1.8% printed last month). In other words wages are rising at a slower pace than the impact of a potentially depreciating Pound. Yesterday we saw UK CPI published with YoY at 0.30% (0.50% last print) and MoM 0.10% from 0.40%. Inflation is therefore not rising as the BoE have indicated and with Wage growth also stagnant UK rates will continue to be pegged at 0.50% for the time being. Heaven only knows how the BoE will react should the UK vote to Leave….

 

US data has shown some signs of life after yesterday’s CPI saw Core CPI YoY flat at 2.1% and an increase MoM to 0.20%. The CPI number comes on the back of other positive US economic data with increases in retails sales, consumer confidence, housing starts and industrial production. This leaves GDP for the US pegged at between 2.75-3.00% for 2016. FED rate hikes are now pricing in a 15% hike in June and 33% hike in July. Later today the FED minutes will be published and this will give us an indication on how FOMC members voted last time round. I am still of the opinion that the FED will be looking to hike at the latest (if at all) in July given the US elections in November. However and I have said this many times, Pres of the FED Yellen, has said many times the FED rate hike decision is dependent on (not only) US economic data, but also (and as important) Chinese (and to a lesser extent EU/UK) growth. With the latter (China, EU, UK) all showing signs are lower growth the FED will have to find solid reasons to hike. The US economy has not shown signs are exceptional growth, and it is for this reason I truly believe the FED will hold back until after the elections to hike. What’s the big rush!!!

So what are my thoughts going forward…well as far as the USD is concerned I think the recent fall has hit the brakes and it looks like FX traders are betting the USD will begin some form of rally from here. Already the EURUSD has fallen back to trade sub 1.13 handle and from the look of it there is more to come and I would not be surprised to see a rally towards 1.10 over the coming week(s).

As for the GBP, well that is pretty simple. As we get closer to 23 June referendum, volatility will increase and you are likely to see large daily moves as rumours (and some facts) make the headlines. I think we will vote to STAY and therefore I will be looking for the GBP to trade stronger on the back of this. Same applies to GBPEUR, a move from 1.2750 to 1.3500 in not going to surprise me.

Good luck and go well

 

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20160517 – DAILY UPDATE

PRICES

On the face of it, the macro data continues to look rather shaky with Singaporean exports falling almost 8% year on year in April. Still this is a marked improvement on the prior month which registered a nearly 16% decline. I tend to think of Singapore as a global bellwether because of its incredibly open economy, so perhaps we can take this as a sign of stabilisation of some sort. Certainly China looks to be on the mend, but the Empire Manufacturing data published yesterday afternoon from New York paints a picture of weak manufacturing in the United States. Still I’m not too concerned at the moment, stocks bounced quite nicely off the support zone I’ve been watching and with oil on the rise, the risk of systemic issues in the oil and gas sector loans market looks to be receding.

 

We also got a negative inflation surprise from the UK this morning, with inflation significantly less than forecast. But again, when you tie that in with the bounce in oil prices it would seem to me that there’s less of a risk of disinflation in the near future.

 

It’s no real surprise that the politics is turning ugly in Nigeria following the raising of the price cap for petrol last week. The government is being criticised by economic pundits and labour unions alike. Historically the unions have responded to fuel price hikes with strikes and this time is unlikely to be any different, we are talking about an effective two thirds hike in prices after all. Let’s leave aside the fact that a huge percentage of the Nigerian population – the non-urban poor – doesn’t benefit from subsidised petrol prices, government is also being attacked because they still refuse to adjust the official naira exchange rate and have required fuel importers to access an already stressed parallel market. The critics may have a point about the exchange rate, but it’s hard to see how a fiscally challenged government could maintain the subsidies. It’s just a pity that these critics haven’t been more constructive in their opposition. As they say, it’s easy to sit in an armchair and criticise. The critics are correct though, this will just increase the spread between the official rate and parallel markets. At some point this has to be reversed and it’s hard to see how that doesn’t involve an official devaluation.

20160517_usdngn

For now consolidation seems to be the name of the game for dollar crosses, but it is still our view that the next short term trend should see a stronger greenback.

 

 

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20160516 – DAILY UPDATE

PRICES

Mixed news for the oil sector. Just as Goldman Sachs upgrades its short term outlook for oil, Moody’s downgraded Saudi Arabia’s credit rating. Supply disruptions in Nigeria coupled with robust Chinese demand have helped the recovery in prices which are now up 70% from the lows at the start of the year. Quite a remarkable turnaround, but too late for Saudi Arabia, where Moody’s is of the opinion that the fiscal situation and higher debt makes the kingdom more vulnerable in the longer term. I remain sceptical about how much further the rally in oil can go, but if the Chinese government has been able to stabilise their economy perhaps we will all need to re-assess not just the oil sector but the global economy’s prospects as well.

 

While all this has been going on the greenback is quietly strengthening across the board. Looking at the majors like EUR/USD, GBP/USD and USD/JPY the pattern is the same, for the last few days the pairs have shown signs of consolidation. These patterns are fairly typical, and normally end with a move consistent with the preceding trend – dollar up. This is what we’re expecting in the next few days. I would be surprised if we don’t see GBP/USD below 1.43, EUR/USD below 1.12 and USD/JPY above 110 (see below). We see a similar situation in a lot of emerging market dollar crosses as well.

20160516_usdjpy

It seems that the period of stability for the naira is well and truly over for now. Setting aside the recent supply disruptions which have pushed output down to a 20 year low (Chevron and Royal Dutch Shell have had to shut down production at a number of sites), the move last Wednesday,  which we reported, to end petrol shortages has had a negative short term impact on the naira. And it just got worse this morning. The naira has now weakened 11.4% over the last week! We believe this to be short term turbulence in the wake of what is a hugely significant and warranted policy shift. This is a move to eliminate subsidies and in time the market for refined products will start to clear more effectively, and we should no longer see queues for petrol in Africa’s biggest oil producer. This is the short term price that needs to be paid.

 

 

 

 

 

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20160513 – DAILY UPDATE

PRICES

Don’t look now, but the greenback is getting stronger. Since the beginning of May there’ve been signs of this. I believe in a recent blog we even mentioned that key levels were being approached in some of the major crosses that could be the optimal points for reversals back into trend. At the time, USD/JPY was the critical currency pair as it was right at the limit of where I thought it should get to, and it duly bounced and the dollar has been appreciating versus the Japanese yen since. I’m already thinking of that 105.55 level as a confirmed key support area now. Any move through that could well fatally damage my conviction in the dollar bull trend. In any case here are some of the interesting movers, you’ll note that the moves are quite decent. I’ve included gold for 2 reasons, (i) it’s not unusual to see gold weaken as the greenback strengthens, so this looks consistent with the thematic move, and (ii) if recent stock market moves were really of such concern, then perhaps gold’s use as a store of value should have aided it over this period, but there is no sense of negative risk sentiment in the air.

20160513_table

The Brexit debate is hotting up. Bank of England governor Carney was at it again, warning of the risks of leaving the EU. In his view this will be very bad for the UK economy, and the word is the IMF is going to come out with a statement soon supporting him. The Brexiter’s might rail at this as political interference, but let’s not kid ourselves, if he came out with analysis that it wouldn’t impact the UK economy they would be shouting it from the rooftops. All of this took centre stage and it’s easy to forget that Carney’s comments came after yesterday’s MPC vote, which remains unchanged. All 9 voted to hold. As we’ve observed many times before, there’s very little likelihood in a change of stance from the BoE for the foreseeable future. Don’t count on sterling going on an appreciation trend anytime soon.

 

Some hugely significant news from Nigeria. I’ll simply copy what I’ve been sent here:

 

“The Nigerian government will deregulate the domestic pump price of imported gasoline in a bid to encourage private marketing companies to import more, minister of state for petroleum Emmanuel Kachikwu said late Wednesday, as the country seeks to end months of crippling fuel shortage.

 

Kachikwu said on state television that the national fuel pricing regulatory body, the Petroleum Products Pricing Regulatory Agency, would announce Thursday a new price band not above Naira 145/liter ($0.74/liter), which fuel marketers would not be permitted to exceed.

 

“In order to increase and stabilize the supply of the product any Nigerian entity is now free to import the product, subject to existing quality specifications and other guidelines issued by regulatory agencies,” Kachikwu said.

 

The government previously maintained a regulated price of Naira 86.50/liter for gasoline, but private marketers said this was not enough to cover the cost of imports, which had already been hiked by tight access to foreign exchange as well as high bank charges.”

 

About time I say! I was actually expecting something like this from the Buhari administration just after the inauguration last year. But one thing that we’re learning about President Buhari is that he takes his time. There’s nothing wrong with a deliberative executive, as long as he’s trying to move the country in the right direction, he should be applauded for this. It has always been an embarrassment for the largest oil producer in Africa to be crippled by queues at petrol stations. I suspect this will eventually drastically reduce that phenomenon. The naira took a hit with fall of over 5% yesterday. This is a new dynamic that is likely to put consistent pressure on the Nigerian currency as new entrants into the refined products market scramble to buy dollars to make purchases. But that’s ok, in the longer term this will make it far more profitable for private firms to invest in refining capacity in Nigeria and this will be of benefit for the naira in the years to come.

 

 

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20160512 – DAILY UDPATE

PRICES

Stocks were weak yesterday probably because of poor updates from retailers like Macy’s and Gap which paint a worrying picture about the US consumer. The decline in prices was the worst we’ve seen in a month, but from a technical perspective there doesn’t seem to be much to worry about (see below). The S&P continues to trade above support, and the trend remains bullish.

20160512_spx

If US consumers are anything like me, there might be a simple explanation for what on the face of it looks like falling consumption patterns. These days I buy everything I can online, and I can’t remember the last time I actually walked into a department store. The chart for Amazon tells the story, bricks and mortar are dying, this is the age of the internet retailer!

20160512_amazon

So why talk about stocks, when the focus of this blog is currencies? Stocks matter, because currencies are affected by risk sentiment and the general economic environment. If it was indeed the case that US consumers (the engine of global growth, don’t let anyone tell you different!), then that would have negative implications for the world economy. It still may be the case, but the data doesn’t yet justify such gloom. In fact the continued strong performance of oil (see below) is probably a boost to the global economy at this point. After all, it lessens the systemic risk in the oil & gas sector loans market, and doesn’t hurt export dependent developing economies. We’ve already talked about why the disposable income boost from lower energy costs has proved elusive.

20160512_oil

What does this all mean? Don’t count on the Federal Reserve to wait too long, if the news about the US consumer isn’t as bad as feared. Furthermore if stocks do stay in a bullish trend the odds of some tightening in the US in a few months will only increase. It means that the odds of a stronger greenback look fairly decent from here. I certainly think that the next big move in EUR/USD looks to be to the downside, but over the next few weeks earnings volatility might keep any trends from taking root.

 

 

 

 

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20160506 – DAILY FX COMMENT

Morning

  High Low     High Low
EUR/USD 1.1423 1.1391   USD/ZAR 15.09 14.93
GBP/USD 1.4495 1.4463 GBP/ZAR 21.84 21.63
EUR/GBP 0.7895 0.7864 USD/RUB 67.36 64.51
GBP/EUR 1.2716 1.2666 USD/ILS 3.7969 3.7808
USD/JPY 107.43 106.88 S&P 500 2051 2042
GBP/CHF 1.4038 1.3997 Oil (Brent) 45.38 44.57
GBP/AUD 1.9668 1.9371 Gold 1280.0 1274.0

We knew it was coming and slowly but surely the data is confirming what the BoE has feared – the UK economy is slowing down and contracting. Services PMI for April was published yesterday showing a fall from 53.70 to 52.30 brought about by a decline in both manufacturing and services. The fall comes as the uncertainty over the EU referendum continues to bite into the UK economy. Rest assured things will get WORSE before they improve. Firms are suspending spending and hoarding cash until after the referendum. While the referendum is on everyone’s minds, what I mentioned yesterday is also having a significant effect locally, China growth (or not) and the US FED decision.

In addition we also saw the introduction of the new National Living Wage (came into effect 01 April) and changes to the UK’s tax regime. As a result of this triple whammy (NLW, EU Referendum and global growth concerns) firms have simply stepped back and slowed hiring, spending and investment until such time sentiment changes. This slowdown will see the UK’s GDP numbers collapse with one UK bank predicting Q2 UK GDP at 0.00 (+0.4% Q1 2016). Is it any wonder then the BoE have made it clear they are not prepared to raise UK interest rates any time soon.

The inevitable fall in the value of the GBP has taken a firm grip (as you can see from the table above). The euphoria that saw the GBPUSD rise to over 1.47 was short lived and we are unlikely to see those levels again until AFTER the referendum when the hope is the UK electorate will vote to STAY and the feel good factor will see the GBP rise strongly on the financial markets.

Needless to say, between now and then you had better strap yourself in and hedge yourself because the likelihood is we “should/could” see the GBP weaken heavily vs our major trading partners (US and EU). No one ever said it was going to be easy J

Later today (1.30pm) we hear from the US how NFP for April faired. Economists are looking for a rise of between 202k (low side) to 250k (high side) after March’s print of +215k. NFP is usually a lottery but if you read what President Obama had to say last night about closing the loopholes on tax evasion following the publication of the “Panama Papers” I hazard a guess US corporates are going to feel the heat and get out the kitchen. The Papers were a real eye sore and proved once again how important it is for banks and other financial services to adhere strictly to Customer Due Diligence and avoid financial products that give rise to Money Laundering.

If the number does indeed prove to be a healthy one (in excess of 215k) you will probably see a continuation of the recent USD rally, but that rally will run out of steam with profit taking and it being a Friday traders trimming their positions.

Be safe, Be lucky and let’s be careful out there

 

DISCLAIMER

Any financial promotion contained herein has been issued and approved by ParityFX Plc (“ParityFX”); a firm authorised and regulated by the Financial Conduct Authority (“FCA”) as a Payment Services Institution with registration number 606416.  It is for informational purposes and is not an official confirmation of terms.  It is not guaranteed as to accuracy, nor is it a complete statement of the financial products or markets referred to.

Opinions expressed are subject to change without notice and may differ or be contrary to the opinions or recommendations of ParityFX. Unless stated specifically otherwise, this is not a recommendation, offer or solicitation to buy or sell and any prices or quotations contained herein are indicative only. To the extent permitted by law, ParityFX does not accept any liability arising from the use of this communication.

Follow our tweets @parityfxplc

Follow us on LinkedIn ParityFX Plc; and at www.parityfx.com