Daily Market Report 07/08/2013 The pound enjoyed another positive morning on Tuesday following four straight days of gains again the euro and the dollar however this would appear to be the top at least in the short term. The pound enjoyed another positive morning on Tuesday following four straight days of gains again the euro and the dollar however this would appear to be the top at least in the short term. Both industrial production and manufacturing data from the UK surpassed expectations pushing the pound up against both the dollar and the euro. These gains were short lived however as the euro zone posted its own positive data in the form of German factory orders that came in at 4.3% compared to an expected 0.3%. Despite the UK posting its own positive figures in the afternoon in the form of the GDP estimate for July, the pound continued to fall. The UK’s woes continue into Wednesday as the Bank of England’s quarterly inflation report is due. Tuesday afternoon witnessed the pound’s decline in preparation for this high risk event. Despite UK house prices rising and another ECB board member stating that further rate cuts in the euro zone were possible, the pound dwindled throughout Tuesday afternoon. Meanwhile across the pond, the head of the Dallas Federal Reserve bank, Fisher, spoke about the on-going debate surrounding the Federal Reserve’s quantitative easing program stating that he believed scaling back the program should be this autumn. These sentiments were echoed by Dennis Lockhart, another Fed big wig. From a global perspective, there is nothing currently that surpasses the QE taper in terms of potential volatility and this will inevitably continue until we hear a definitive statement from the Federal Reserve itself. Wednesday’s focus will be solely on the Bank of England as speculators wait to see what policies the Bank of England look to implement in an attempt to build a sustainable economic environment for continued economic growth. The exact plans are unknown although it is suspected that the Bank will try to replicate the system in the US by utilising the ‘forward guidance’ method where inflation and interest rates are more closely linked to the employment situation and economic performance. Key Announcements: 10.30am – GBP – Bank of England Quarterly Inflation Report. 10.30am – GBP – BoE Governor Mark Carney Speaks at Parliament. 11.00am – EUR – Industrial Production (Jun): Expected to improve to -0.4%. 12.00pm – USD – Mortgage Applications (Aug 2): Previously showed a fall of -3.7%. 13.30pm – CAD – Building Permits (Jun): Expected to fall -3.2%. 15.00pm – CAD – Ivey PMI (Jul): Expected to rise 57. 20.00pm – USD – Consumer Credit Change (Jun): Expected to fall to US$15bn.