The pound has continued its bearish run this morning ahead of the second estimate UK Q2 GDP reading.
Spreadex Analyst, Connor Campbell commented “Cable slipped 0.1% after the bell, keeping the pound below $1.28 and at its lowest price in just shy of a month.”
“Though sterling technically fared better against the euro, rising 0.1%, the currency is still in serious trouble against its Eurozone peer, trapped under €1.085.”
“Given the near uninterrupted fall the pound has seen against the euro since July, the threatening figure of parity has begun to appear on the horizon”
The Pound’s continuing problems enabled the FTSE to post a 15 point climb this morning, helping the index to close in on the benchmark level of 7,400.
Momentum could easily change with this morning’s GDP reading, with analysts are expecting the second quarter figure to come in unchanged at 0.3%.
Over in the US, equity markets closed lower across the board yesterday as President Trump’s threats to shut down government in order to deliver on his election promise to build a border wall, plaguing market sentiment.
Accendo Markets Analyst, Henry Croft noted “Industrial and Consumer names bore the brunt of the sell-off, resulting in the Dow Jones closing almost 100 points lower – with Boeing and J&J weighing – while the S&P 500 also closed 0.4% offside and the Nasdaq finishing 0.3% weaker.”
Currency traders will shift their attention today to the monetary policy guidance expected from the central bankers at Jackson Hole. ADS Securities Analyst, Konstantinos Anthis commented “Over the next 48 hours there are no major data releases, so the dollar is expected to take its cue from Yellen’s speech on Friday.”
“Depending on how much detail she provides on the Fed’s intention to start reducing its balance sheet, the dollar could start a sustained rally.”