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Pound keeps on falling, USD strengthens

Pound keeps on falling, USD strengthens

My morning newsletter may get a bit repetitive over the next 9 days as Scotland leads up to the referendum and my apologies for this, but it is the uncertainty that is driving the market and causing the Pound to keep on falling.

 

Nothing can stop this at the moment, as even stronger than expected retail sales don’t even temporarily halt the fall. Mark Carney is due to speak today but even if he comes out and says when he expects interest rates to rise, which he won’t, Sterling probably won’t start to recover.

 

Something that appeared to be a formality is now anything but, and Gordon Brown has now been rolled out to convince Scottish voters that staying part of the Union is the way forward. He has pledged that he will personally put before Parliament by January a bill giving them control over welfare, taxation and economy. Is this too little too late? We wait to see and will no doubt report on more twists and turns tomorrow.

 

The Dollar continues to strengthen against all and sundry. Whilst the US economy is recovering and coming along nicely, it is not so impressive that it should be gaining so strongly and so quickly against all other currencies. However, it is profiting from ECB issues, sanctions against Russia, uncertainty over the Scottish Referendum and weakness in commodity currencies.

 

Lots of data out of the UK today, headlined by Mark Carney’s speech but also including trade balance figures, GDP estimates and production reports. There is nothing out of the Eurozone which isn’t great news, as there is nothing to halt the slide of the single currency against the Dollar. We also have a couple of speeches out of the US and some business optimism figures.

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