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Morning Round-Up: The FTSE, Pound and Gold


The FTSE was flat in early trading this morning with investors awaiting this morning’s inflation data and it’s impact on the Pound.

Spreadex analyst, Connor Campbell commented “It’ll be interesting to see how sterling reacts to Tuesday’s latest inflation reading. Analysts are forecasting the figure will slip from 3.1% in November to 3.0% in December, in what could be the first stage of it unwinding the rapid rise seen in the second half of 2017.”

“Now, 3.0% is still very high, especially with wage growth constantly trailing behind; yet a reversal will only further delay a Bank of England rate hike, something that could pull cable away from its recent post-Brexit referendum peak.”

Investors should note that any move away from expectations is likely to have a knock on effect for both the Pound and the FTSE.

It was the mining sector holding back the FTSE this morning with Antofagasta, BHP Billiton, Anglo American, Fresnillo, Rio Tinto, Glencore and Randgold all falling more than 1% following a negative session in Australia overnight.

The Dollar is struggling to move higher which has also benefited both the Pound and the Euro. It has also had an impact on commodities prices and FxPro analyst Edward Anderson noted “Gold continues to benefit from dollar weakness reaching a 4-month high on Monday and its strength has continued into Tuesday trading.”

Investors should note that the US markets will re-open today following yesterday’s national Martin Luther King holiday.

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This article does not constitute investment advice. Make sure you do your own research or consult a professional advisor.

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