020 7898 0500Sterling traded within a very tight range on the whole yesterday, ahead of a crucial week in the global markets as the media circus keeps its focus on events across the pond. The outcome of the US presidential election could have far-fetching implications for the currency markets around the world.
Closer to home, the UK has its own issues to deal with. Newspaper reports over the weekend suggested Bank of England (BoE) Governor Carney was planning to leave in 2018. This in turn has promoted an official spokeswoman for Prime Minister Theresa May to say that she believes Mark Carney is the right person to be BoE Governor. Carney clarified his position yesterday evening after much speculation and confirmed that he would stay for an additional year and end his tenure in June 2019. This was welcomed by investors as it means Carney will remain as Governor of the Bank of England until a few months after the UK has officially left the European Union.
UK data was slightly more encouraging yesterday, but did little to move the market with the docket packed for the week ahead. UK mortgage approvals picked up by more than expected. However, the number of mortgage approvals remains below its level in the months running up to the referendum. This could be used as a forward looking a gauge of housing market activity.
Sterling has fallen significantly over the past couple of months, which in turn prompted inflation concerns. On the other side of the coin it should have also made the export market more competitive. Today’s manufacturing Purchasing Managers’ Index (PMI) numbers will give the market a good gauge of how this has been translated in terms of orders.
