Chinese Data Continues to Improve
|Chinese inflation data pushed higher in December according to readings released overnight. The readings showed that the increase in the oil price had driven up prices in China, which has yet again showed further signs of encouragement and recovery. However the big question surrounding China has been whether the government will accept the more modest growth in the economy, with the economy likely growing by around 6.5% for 2016.
This is pivotal for global markets as growth in potentially the world’s largest economy is paramount for business in other regions, with the likes of the oil industry reliant on a strong prosperous China. Years of spending have plunged many of China’s major industries into crippling amount of debt, factor that will hold back GDP growth in the coming years.
Today’s session is yet again looking a little light of data, but again we have to focus on what we will get from Donald Trump in tomorrow’s news conference there is likely to be man questions surrounding the appointment of his White House staff, especially after announcing his son in law Jared Kushner. Usually a press conference such as this from a President would be of very little interest to the markets, however a news conference from Donald Trump has the potential for much more in the way of fireworks.
Yesterday’s comments from Theresa May have caused huge downside in sterling, despite the fact that they were very much nothing new. The move has broken GBPUSD below some key levels and left it approaching the downside level at 1.2085. A break below this downside level could open up a move to the flash crash lows at 1.1485.
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