GBP has strong finish to week
Yesterday’s UK retail figures came in better than expected which gave GBP an unexpected boost.
After an initial period of strength the US dollar lost 200 pips versus GBP yesterday. The market has begun to price in a reduced chance of tapering from the Fed amid dampened growth caused by the US Government shutdown,
Overnight chinese data has come in marginally better than expected. Given the significance of the Chinese economy, this is considered very positive for the global economy as a whole and we see funding currencies such as USD weaken and commodity based currencies like AUD strengthen.
Next week the market is likely to be focused on potential Fed tapering again as the delayed US Non Farm Payroll data is released.