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US debt ceiling still looming

US debt ceiling still looming

After an extremely quiet day on the markets yesterday – we are are back with a bang today:

9:30am we had UK Inflation data – typically one of the major factors for deciding interest rate policy, the influence of this data has been reduced by the introduction of forward guidance from the BoE. However the figure came in broadly as expected, if anything a bit higher than expected which has already given GBP a small boost back towards 1.1800 vs EUR and 1.6000 vs USD

11:00am we have the German ZEW survey. Measuring institutional investment sentiment, this data is considered a strong yardstick for the German economy and as a result could be negative or positive for Euro

In the US; rumour has it that the senate will be meeting today at 4pm UK time (11am local time) to discuss a ‘kicking the can down the road’ agreement which would reopen government and extend the debt ceiling until the new year. Given the comparative strength of USD in these circumstances, it would seem that the market are certainly pricing in a very high likelihood of a resolution before the deadline on Thursday.

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