Daily Market Report 25/10/12

Sterling reeled off an impressive performance yesterday as it rose against almost all of its peers. Investors in the pound are speculating that the UK GDP figures, released today, will return positive as the nation exits a previous recessionary quarter.

Rising from a 0.4% contraction, analyst estimates place the UK’s Q3 performance at 0.6%, an outcome that David Cameron may have prematurely alluded to during Question Time, causing confidence in sterling to increase.

The news saw the pound rally the most in three months against the euro, coinciding with some depressing euro PMI data and poor German business climate figures.

The dollar also gained in value against the euro as an FOMC meeting saw the committee opting not to increase the level of monthly bond purchasing, citing an improving economic performance as sufficient reason not to boost stimulus and debase the currency.

All eyes will be on the UK today as yesterday’s rallies may be vindicated at 09.30 this morning as the GBP figures are released. In the US, analysts expect to gain forward momentum with positive figures across the board, if combined with positive UK data, cable could ascend.

 

Today’s Key Announcements:
  • 09.00am – GBP – Prelim UK GDP q/q: expected to reach 0.6% from -0.4%
  • 11.15am – GBP – MPC Member Tucker to speak
  • 13.30pm – USD – Core Durable Goods Orders m/m: expected to increase to 0.8%
  • 13.30pm – USD – Unemployment Claims: expected to decrease to 371k
  • 13.30pm – USD – Durable Goods Orders: large increase expected to 7.2%
  • 15.00pm – USD – Pending Home Sales m/m: anticipated increase to 2.3%

See previous Daily Market Reports