020 7898 0500The US dollar continued to strengthen against both sterling and the single currency yesterday. The Greenback had given up some of its gains on Friday due to end-of-week profit taking.
Markets are now pricing in an 80% chance of an upcoming interest rate hike in the US. Economic data has been positive and held its ground despite the uncertainty surrounding the new political direction.
A figure that will be closely watched this week will be non-farm payrolls on Friday. If this turns out to be positive, it will be hard to think there could be anything in the way of a further interest rate hike next week.
Meanwhile, US factory orders rose for a second consecutive month in a row, suggesting that the recovery of the manufacturing sector was gaining momentum.
Looking to the day ahead, the key data release from the US is the trade balance.
