Super Thursday

3 November, 2016

When the Bank of England presented its last Inflation Reports, the dust was still settling from the UK’s decision to vote to leave the EU. The Bank cut interest rates and slashed their growth forecast for the coming year. Three months later, they view a very different picture. The economy has performed better than they expected, but the uncertainty remain regarding the road to Brexit and this will be emphasised in today’s report and the Governors press conference. The bigger change has been the currency, which has fallen a further 7% against the dollar since the August Report. That will see headline inflation over-shooting the Bank’s 2% inflation goal on their forecast horizon. The Bank will no doubt stress the temporary nature of this over-shoot, so rates will be indicated as being on hold for the time being. Bank in August, the majority of the MPC anticipated a further cut in rates this year, which is not likely to be seen given the better performance of the economy and deterioration in the inflation outlook. Sterling has been performing well over the past few sessions, so whilst may be holding up now, low rates and higher inflation with low demand is not a positive longer-term outlook.

Elsewhere, the FOMC meeting last night saw marginal changes in the statement with one less member voting for higher rates, in contrast to the three dissenters seen in September. The passing of the meeting, means that the residual risk for a hike that was being priced into interest rates markets has now been pushed into December, so the pricing there is not nearly an 80% chance for a move higher. The dollar was little moved, but remains softer on the back of the latest US presidential rate developments, the dollar down nearly 2% over the past eight trading sessions. Equities have also been softening over the past few sessions, with measures of volatility increasing sharply has the outcome of the presidential race casts a cloud of uncertainty over the market.

Source link  
Cautious mood has returned to stocks

American markets ended trading on Wednesday with a slight increase. Asian bourses also experienced growth at the opening, but it was quickly...

Emerging markets rebound seems over

Asian markets have turned to a decline with a renewed force. After the rebound of last week, the index MSCI Asia ex Japan loses 1.2% and is only...

Rebound in Asian markets intensifies

On Friday morning, the demand for risks on the Asian bourses continues to recover. MSCI for Asia ex Japan is adding more than 1.2% this morning, having...

Reasons to rebound EM indices

Asian markets are adding after reaching 14-month lows the day before. Positive markets are supported by the reports about China's invitation to trade...

Strong data supports U.S. markets

Stocks of the Emerging Markets remain under pressure on Wednesday morning, with positive sentiments prevailing in American markets following...

Pound press dollar on news about Brexit

Michael Barnier, the EU's top negotiator on Brexit, called a reaching of the agreement on the deal within next 6-8 weeks realistic. This news supported...

Brent reversed from resistance level

Brent Crude Oil recently reversed down sharply from the major, multi-month resistance level 79.50 (which has reversed the price multiple times from the...

EM Markets sale-off spreading to DM

The current weakness on the developing countries financial markets is the longest since 2008. The similarities go further than that: as well as 10 years ago...

The price for trade uncertainty

The markets are cautiously on buy for American stocks, and the dollar adds on fears that trade conflicts are seriously stifling the business sentiment...

In the past 24 hours Bitcoin has lost -0.93% and reached $6547.603597. Open your trading account with the best cryptocurrency brokers on special terms today.

In the past 7 days the EUR/USD pair has gained 0.6352% and is now at $1.1587. Start trading and making money on Forex today.

In the past 7 days Ethereum has lost -8.27% and is now at $207.129522226. Have the most popular cryptocurrencies compared online 24/7.

Top Brokers offering Daily Forex Market Reviews

Forex Currencies Forecasts

Top 10 Forex Brokers 2018

# Broker Review
6FIBO GroupFIBO Group84%