Daily Market Report - 21/10/2014

The European Central Bank (ECB)  began its new stimulus programme yesterday, buying up covered bonds, which are debt backed by cash flow from mortgages or consumer loans. It was reported reported that the ECB has wasted no time in mopping up debt from France. The ECB hopes that the scheme will encourage banks to offer credit to small businesses in Europe, to drive economic activity and inflation.

The pound rose to a one-week high versus the dollar after reports showed U.K. home prices gained for a second month in October rising 2.6% (MoM). A separate gauge of consumer confidence in the third quarter increased three points versus year ago, the Deloitte Consumer Tracker showed today. This is the highest since the survey began in 2011. 

Net lending to businesses continues to fall, despite efforts from the bank of England to increase business borrowing. Net lending to all firms fell to 3.9 Billion in second quarter of 2014. The report suggests that businesses are trying pay down debt instead of borrowing. 

Key Announcements
USD - 15:00 BST  - US Existing Home Sales expected to increase from 5.05 to 5.1 Million

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