Market Report

Yesterday we saw continued gains in GBP as housing data from the Nationwide building society said house prices jumped sharply in August which fuelled speculation that there may be another hike in UK interest rates as soon as November.

The European Central Bank held rates at 3 percent and indicated that there may be a hike in October. But this failed to lift the Euro as markets had already been priced for such an outcome.

Today data is UK CIPS report (due at 9.30am) to be at 54.2 from 53.8 previously (consensus is 53.7). This may continue to be positive for sterling. Then from the States at 13.30 Non - farm payrolls, like the consensus, we expect US payroll employment to increase 125k following a 113k reading in July. But this is one of the big market movers each month so there should be some excitement if the figure is different like yesterdays football transfers.

DH

Today sees a wealth of economic data being released, mainly from the US. Yesterday the Dollar fell against most major currencies after sentiment of any new rate hikes diminished.

At 1:30 we have the jobless claims from the US followed by less important data from 3:00. The markets are waiting to see what happens in the US non farm payrolls tomorrow. Any further bad news for the dollar may see new lows.

Today sees the close of the football transfer window, it should be interesting reading tomorrows newspapers!

DE

Sterling rose to a one-week high versus the Euro on Tuesday, and peaked to a 2 week high against a dollar pressured by uncertainty over the outlook for U.S. rates.

Signs of a pick up in the UK housing market have convinced some investors that this month's rate hike from the Bank of England could be followed by another move before too long.

FOMC released there minutes at 18.00 last night and after a session of very lacklustre trading the minutes spark a small rally saw the USD slide. The FOMC's decision to keep interest rates on hold at the last meeting was quoted as a "close call" but they seem to be relying on future depressed growth in the quarters ahead in order to suppress inflation.

Today the main focus will be on the US revised GDP data at 1.30pm, which we expected to be around 3.1%, vs. the 2.5% in the advance estimate (consensus is 3%).

Also today Fed President Fisher will deliver a talk regarding US inflation at 2pm.

DH

Good morning all hope you have had a good weekend, after a quiet week for data release we see some more significant data this week starting with the consumer confidence from the United States. This is a good indicator for the markets on how the consumer is likely to behave in the future. We also have the minutes from the FOMC which will give us an indication of the next move in interest rates. The Dollar at present currently remains weak.

Sterling has seen some strength as of late with the threat of another interest rate hike on the cards for later in the year. Data released on Friday showed economic growth reached its fastest rate for two years which means inflation is still firmly on the agenda. There are no significant data releases today.

VC