Good morning

	High	Low			High	Low
EUR/USD	1.0968	1.0902		USD/ZAR	15.2965	15.1020
GBP/USD	1.4912	1.4862		GBP/ZAR	22.75	22.45
EUR/GBP	0.7372	0.7329		USD/RUB	70.34	67.85
GBP/EUR	1.3644	1.3565		USD/ILS	3.9000	3.8790
USD/JPY	121.00	120.30		S&P 500	2066	2057
GBP/CHF	1.4761	1.4659		Oil (Brent)	38.04	37.47
GBP/AUD	2.0587	2.0439		Gold	1074.0	1069.0

Quiet open on the FX markets in Europe ahead of the long Xmas weekend.

No change in my sentiment from yesterday. I am looking for the USD to resume normal operations in the coming days/weeks as traders return from their holidays and put on positions. As long as the US economy continues to grow and expand the likelihood of further US rate hikes will be a matter of how soon rather than when. That will give the USD a further boost and see the greenback finally break PARITY (EURUSD 1.00/1.00). 

The Pound though will fair somewhat differently given the “strength” of the UK economy (despite yesterday’s disappointing Q3 GDP numbers). While UK rate hikes have been pushed forward to the latter part of 2016, should things turn around and we see growth in GDP, wages and CPI – that decision to raise could very well be brought forward. The EU referendum is a thorn, but its too far away for now to cause real damage to the GBP. Further down the line I see the GBP staying in the 1.40-1.52 range for 2016 while vs the EUR I believe the GBP will break 0.7000 (1.4285) and trade sub this level for the year.

To all our readers, we hope you have enjoyed reading our daily comments as much as we enjoy writing it.

WISHING YOU AND YOUR FAMILIES A MERRY XMAS

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