Daily Market Report – 09/09/2014

GBP:
Yesterday was heavily focused around the UK. Sterling took a big hit in the
morning after the Yes campaign took the lead in the Scottish independence poll,
just 10 days prior the actual vote. as a result GBP fell by 2 cents versus
the US dollar to its lowest level since November 2013.

Factors which are pulling sterling down are the fears over the Scottish banking
sector, it’s currency choices if it went independent and the level of debt from

GBP:
Yesterday was heavily focused around the UK. Sterling took a big hit in the
morning after the Yes campaign took the lead in the Scottish independence poll,
just 10 days prior the actual vote. as a result GBP fell by 2 cents versus
the US dollar to its lowest level since November 2013.

Factors which are pulling sterling down are the fears over the Scottish banking
sector, it’s currency choices if it went independent and the level of debt from
the UK Scotland would have to accumulate.Some analysts  have suggested
that the pound could fall by at least 5% more if Scotland votes “Yes” on 18
September.

The poll results also had a big impact on the UK stock market with the
blue-chip FTSE 100 index , led by two Scottish-based banks Lloyds Banking
Group are down by 3.3%, wiping £1.74bn off its value. Royal Bank of Scotland
fell by 2.8%, or £1.1bn which shows the seriousness of how the decision can
potentially impact the UK.

Also in the UK, with the housing market evidently having a great run, it eased
off last month with prices only rising at a minimal rate.Halifax’s monthly
survey of the market indicated that prices increased by just 0.1% in August,
dramatically lower than the 1.2% reading in July.

Recent affordability tests, and the concept of the Bank of England increasing
interest rates sooner rather than later, are still also key factors potentially
influencing the market. With this said, weak wage growth, and pay packets
failing to keep up with inflation, can also be damaging the demand for
properties.

EUR:
Yesterday it was reported that  Spanish house prices rose for first time
since 2008. With many reports suggesting Spain’s long property decline may be
over.House prices in Spain rose by 0.8% year-on-year in the second quarter of
2014, the first annual rise since the financial crisis began six years ago.

Spain’s housing market boomed during the early days of the Eurozone, fuelled by
easy credit. This eventually led to banks suffering huge losses, forcing Spain
to take rescue funds from the EU due to lending to individuals who could not
afford to pay back. However, banks in and around Spain have now began
advertising bank loans for property buyers, so this shows a high level of
confidence again.

Key
Announcements: 

09:30 – BST – GBP – UK Trade balance (July) Deficit expected to fall to
9.1B

11:45 – BST – GBP – BoE Govenor Mark Carney will make a speech
 
15:00 – BST – GBP – NIESR UK GDP Estimate for three months to August

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