Morning all
Hope you’re well and over Monday.
GBP
Forecasted interest rates to be up to 2.5% by November. Much like the saga last week, most of the movement is focused on the rhetoric after the rate hike. Expect no surprises when interest rates go up, however listening to the press conference afterwards is paramount. As stated by Andrew Bailey (Head of the Bank of England) we are officially in a period of recession. The fact that the BoE are now willing to raise interest rates means that they are broadly supportive of the Pound, as are indications the BoE are not read ready to stop. The BoE however said it was only concerned with inflation fighting and would not place a heavy emphasis on these forecasts, therefore prompting markets to bet further hikes are coming. If we get ahead of the curve this year, we expect at least 0.75% of rates cuts in 2023…
EUR
Doom and gloom for Europe based businesses, not so for you EUR buyers…why?
- Winters are always tougher in Europe, which is only round the corner
- Banks see the odds of a recession (worse than ours) as strong
- High energy prices – just look at the Gas saga with Russia
I’m hanging my hat on 1.20 by the end of October
USD
Non-Farm payroll figure was ridiculous on Friday. Consensus was that 250,000 jobs were created in July, however the figure topped out at 528,000! US are smashing it at the moment which is why I feel we need to get used to this trading range in the early 1.20’s. Gone are the days of 1.30+ for the time being….
Have a good afternoon, here if you need