020 7898 0500The dollar weakened further against sterling and the euro yesterday, despite the fact that interest rates are likely to be hiked later today. The truth is, the markets have 100% priced in a 25 basis point increase so no dollar movements related to this are expected. Interestingly, there is currently a 72% chance of another 25 basis point hike in December, which would be the fourth hike of 2018.
There were no major economic data releases yesterday but there was plenty to discuss, with oil prices climbing above $82 – the highest mark for four years. There is growing speculation that we might soon see prices hit $100 a barrel, with some suggesting we could see the $90 mark before the year is out. The increased cost can at least be partly attributed to the US imposing sanctions on Iran which caused exports to fall by more than 700,000 barrels a day.
America has a busy schedule lined up for today, with the new home sales figures for August. Before that, we will see the aforementioned interest rate decision from the Federal Reserve. The Federal Market Open Committee will also release its economic projections and the Fed’s press conference will certainly be interesting.
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