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  • GBP starts the week on a soft tone
  • Friday’s US Non Farm Payroll report was slightly softer than expected but provided no big surprises
  • Markets focus on Donald Trump’s press conference on Wednesday

Sterling has started the week on a soft tone following Theresa May’s comments over the weekend, which have been viewed as her reverting back towards a ‘Hard Brexit’ tone, with immigration seemingly taking priority over membership to the single market

  • GBPUSD has broken below trend line support at 1.2225 and recent 1.2200 support. Our traders see 1.2083 as the next target support level, the post flash crash low, followed by 1.2000

Friday’s US employment report for December provided no big surprises

  • Nonfarm payrolls expanded 156k in December, below consensus expectations (175k), whilst the unemployment rate ticked higher to 4.7%. However, average hourly earnings jumped higher, rising 0.4% m/m
  • Overall, the report was slightly softer than anticipated though the slowing of employment growth in the second half of 2016 is consistent with late-cycle behaviour of the US labour market. In the near term, we expect Trump’s proposed aggressive fiscal stimulus this year to offset recession risk, effectively extending the cycle

This week, US politics are likely to be the main market driver. Investors will pay attention to President-elect Trump’s press conference scheduled for Wednesday. In addition, the confirmation hearings for different cabinet members begins

via Barclays

Todays’ currency rates

GBPUSD = 1.2178


GBPEUR = 1.1548


EURUSD = 1.0546


GBPAUD = 1.6636


EURGBP = 0.8660

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Matt Vann

Matt has been trading for over a decade, trading with various forms of Futures, Spread Betting and occassionally, CFDs. He'll trade limited markets including Indices, Currencies and selected Commodities such as Silver and Natural Gas.

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