Daily Update
During the trading hours of yesterday midday, we noticed an appreciation of EURO and GBP. This was mainly due to the fact that positive data from the Germany unemployment rate and market manufacturing PMI from Europe applied a Positive Upward pressure on Euro. Soon after UK PMI Construction was released, which shows business conditions in the UK construction sector came out positive, boosting the GBP. Later in the evening, The most awaited Rate Hike decision of the quarter was released from USA. Federal Reserve of USA decided to retain the rates to further monitor economic conditions. During the Federal Reserve Meeting Minutes, the statement said that there has been some further evidence that a case for rate hike has continued to strengthen while inflation has increased somewhat since earlier this year. The general feel is that economic conditions will evolve and near term risks to the economy appear balanced. Markets are pricing in a 78% chance of a rate hike this December. As the dust settles from the Fed’s rate decision, the Bank of England will decide their rate decision and monetary policy summary today. The concerns on the pound dropping to 31 year lows against the dollar and 5 year lows against the Euro. The head of the Bank of England, Mark Carney, did expressed last week again that they may need to intervene to help support the weakened pound as the uncertainty of Brexit remains. As inflation gathers pace towards the 2% target of Bank of England, the talk of cutting rates again have turned to the possible need to see an increase of the interest rates to tackle the inflation rising too high too fast. No doubt with Sterling dropping, this meeting will be watched to see how Mark Carney and the MPC members tackle these issues.Yesterday's markets
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