United Kingdom, doing well. Greece…see me after class.
Yesterday, the GBP broke fresh higher ground against the USD to make new highs of 2015. There are a lot of factors at play at the moment and, pleasingly, there are a great deal of UK positive elements to the scenario. In the Mediterranean, however, I can but imagine the short fingernails sported by the Greek government officials as they attempt to stop the flow of both debit funds and news.
The UK Industrial Production (which examines UK factories and mines output) was a really positive figure both in terms of yearly comparison and month on month comparison. We saw a resounding improvement in both units, several times the forecast figure. The UK Manufacturing Production figure was, again in both yearly and monthly measurements, a positive result – albeit not as strong as the Industrial figures. During the day, the US produced some second tier data that was close to forecast figures and so had little impact. The net result of the day was a significant surge of the Pound against the Dollar.
The Greek settlement of their outstanding interest payment, while a day early, has been the subject of much scrutiny due to the method by which they seem to have produced the money. Yanis Varoufakis, the Greek finance minister, warned that the country was just weeks from running out of cash and EUR650m of the payback funds this week have been touted as being borrowed from their IMF holding account. The IMF has said that they will not be involved in a second round of funding for Greece…
Today, we have a lot of data to be released. The UK is to produce, in a few minutes from now, a slew of jobs data including Unemployment Rate and Claimant Count. Then the Bank of England Governor, Carney, is to give a speech with the Quarterly Inflation Report. This could be critical as the inflation rate and its recovery are vital to signals of growth. Then the USD Retail Sales figure is due, which looks like a negative forecast for the States. And lastly, we have the European Central Bank Policy Meeting which, given the context of this year, is an influential meeting of course. There appears to be still more buying opportunities for those who are seeking to sell GBP and buy other currencies.