Daily Update - 30th March 2017
Yesterday’s Market Yesterday was a big event for the Market players as they focused purely on the ongoing split between the UK and the EU. Remarks by President Donald Tusk following the UK notifications, he admitted that it’s not a happy day for them as most Europeans, including almost half the British voter’s wish that they would stay together, not drift apart. He stated, “There is nothing to win in this process, and I am talking about both sides. In essence, this is about damage control. Our goal is clear: to minimize the costs for the EU citizens, businesses and Member States. We will do everything in our power - and we have all the tools - to achieve this goal. And what we should stress today is that, as for now, nothing has changed: until the United Kingdom leaves the European Union, EU law will continue to apply to - and within - the UK”. Although the ‘hard' and ‘soft' Brexit debate has largely passed, there is still some leeway as to how ‘hard' it will be. Analysts questioned “Is it Brexit Deal better than No Deal? Due to this uncertainty, GBP is highly volatile. While on the Reports released on Wednesday related to US Pending Home Sales (MOM) was far better than expected as it increased to 5.5 last month, far above the forecasted level of 2.1. Meanwhile, several comments made by FOMC and FED members focus to the prospect of further rate hikes this year. FED member Charles Evan suggested that two rate increase seems very safe and Eric Rosengren suggested that FED should be prepared to raise interest rates a total of four times in 2017 to prevent the U.S. economy from overheating. Further FOMC member Williams also shared a very positive outlook on the US economy. These were the main reasons for the EURO and Pound to fall against the USD on Wednesday. Today’s Market There are several other important reports coming from European Union as they release Consumer Confidence that measures the level of consumer confidence in economic activity, Economic Sentiment Indicator the trend of the overall Euro Zone economy. Also report coming from US such as USD Initial Jobless Claims and GDP Annualized that will show the monetary value of all the goods, services and structures produced within a country in a given period of time. It is the gross measure of market activity because it indicates the pace at which a country's economy is growing or decreasing. Furthermore, speeches from FOMC members Kaplan and Williams. Expect the FOMC member to give a positive outlook on the US economy as it has been the norm for this week by FED and FOMC members.
