- Posted by currencies in Bank of England, Bremain, Brexit, Currency, Dollar, Economy, EUR, Fed, GBP, Mark Carney, No Deal, Prime Minister, Referendum, Retail Sales, Sterling, UK, Uncategorised
- January 20, 2020
- No Comments
Last week Retail Sales figures disappointed coming out weaker at 0.7% against the anticipated 3% rise.
Large name retailers across the UK have stressed that December’s sales were the worst they had seen in years. Throughout last week Sterling had the worst performance out of all the major currencies.
Moving onto the upcoming week it is expected that economic data will continue to impact the markets. The following pieces of economic data are some of the key pieces of data for the UK this week; On Tuesday it is the release of the UK’s jobs and earnings data, the average weekly earnings are forecasted by traders to drop from 3.2% to 3.1%, if it does drop further than this expectation we should see the pound weaken.
At the same time of this release we will find out the UK’s unemployment rate which is expected to stay unchanged at 3.8%. On Friday PMI (Purchase Manager Index) data is being released, they are all expected to show a slight increase with the services PMI increasing to 51.0, Composite PMI moving to 50.7 and manufacturing PMI going to 48.7. With PMI data if the figure is below 50.0 it is not viewed as a positive so unless there is a more significant jump on the manufacturing front that single piece of data will not be great.
The US and China recently signed off the Phase One trade deal, but business leaders across the US don’t see this as a massive breakthrough as there is plenty more negotiating to be done. They will soon move onto getting a Phase Two deal agreed but this process will take time.
Patrick Harker, Philadelphia Federal Reserve Bank President, as a whole said that trade tensions, geopolitical tensions and an economic slowdown across the globe are currently holding back business investment in the US but overall the economy is doing good.
EU and China negotiations on an investment agreement have been progressing and it seems they are beginning to move in the correct direction. EU officials have been trying to gain more market access for European businesses in China.