Sterling holds gains on Brexit deal hope

• Dire Chinese data harms Asia and Australasia
• Sterling holds its growing ahead on yet another crucial Brexit week

If you have friends who do not follow rugby or you yourself have not yet seen the light, please find a recording of the Japan v Scotland game played yesterday. You will be awed. It was a phenomenal spectacle with poignancy and emotion enhanced by the spectre of a typhoon that devastated parts of Honshu and took at least 42 lives plus countless homes and business. And seeing the Canadian team helping with the clean-up was heart-warming. Both events were great examples. We are thinking of you today. 

The financial markets, in Europe at least, are bracing themselves for yet another in a series of eleventy-twelve crucial weeks where the UK Prime Minister takes on all comers in order to try to deliver a deal that will squeak through the UK and EU parliaments like a cruise liner through the Corinth Canal. I would wish him the best of luck but that’d offend someone somewhere.

 

Sterling holds its growing ahead on yet another crucial Brexit week

Sterling has held up well, so it would seem the markets are expecting some clarity and, after 40 months of abject uncertainty, that is a welcome relief. Imagine how far the Pound could go if there is certainty of one form or another. We are expecting employment and retail sales data from the UK this week, but that pales into insignificance compared to the machinations of the UK/EU negotiations.

By the way, don’t you find it sweetly naive that the UK press gets so animated when the EU says something negative about the UK plans and proposals? I don’t think they have seen negotiations before. I am old enough to remember the 70s and the trade union versus employer vitriol. This is so very mild in comparison.

 

Dire Chinese data harms Asia and Australasia

This week started with dire Chinese data, just to add to the reams of other recent dire Chinese data. Chinese exports were down 3.2% and imports were down 8.5% in September. I am sure the US President will smile when he sees the damage he is doing to China’s economy. That too is a negotiating tactic, but the collateral damage this will be inflicting on China’s suppliers in Asia and Australasia is another matter.

 

Aussie and Kiwi weaker

The Aussie Dollar and New Zealand Dollar are significantly weaker today than they were at this point last week and the GBPAUD and GBPNZD rates are enhanced by Sterling’s recovery; at 1.85 and nearly 2.00 respectively.

 

Today’s data

The rest of today’s data releases are few and far between but Eurozone industrial production data is expected to show an improvement on July’s data; but not enough to offset July’s 0.4% contraction. As with the Pound, the Euro is probably more heavily influenced by a possible Brexit outcome than this data. 

 

Virtual worlds…

And, for parents who found their children actually talking to them yesterday and cannot fathom why, well, the makers of the online game, Fortnite, caused a huge stir by destroying the cyber-world in which the game was played and sucking the whole thing into a black hole. I suspect there was very little flossing taking place. Make the most of this short time you have with your kids, though, because there will be a new version of sorts very soon.