Today's news headlines:

‘Hunt to rule out tax cuts while touting UK’s Brexit potential’. UK Chancellor of the Exchequer Jeremy Hunt is expected to voice his optimism for the UK growth outlook today. Hunt believes that the sour tone on the UK growth picture has been unwarranted, with Brexit set to provide the country with a boost as growth remains lacklustre. Investment restrictions are expected to be scaled back with the EU’s Solvency II rules due to be abandoned, freeing up private capital. (Bloomberg) 

‘Treasury reaction to US GDP shows Fed dragging feet in last lap’. Market pricing for the Federal Reserve meeting next week suggests a 25 basis point hike is the likely outcome as the central bank reigns in the pace of rate hikes. Growth of 2.9% in the fourth quarter of 2022 gives the Fed some room to manoeuvre and continue hiking by 0.5% increments. However, Chairman Jerome Powell sees an end to this current hiking cycle in the coming months and rates to be restrictive enough to tame record levels of inflation. (Bloomberg) 

Today

Equities are mixed this morning following some earnings releases in Europe, with investors weighing the impact of an economic downturn on companies’ bottom lines. The Dollar is trading flat while oil prices tick higher. Sovereign bond yields are higher across the curve in most major economies in early trade. 

Events

Spain flash GDP QoQ (Q4 2022): 0.2% (est. 0.1%) 
US Core PCE Price Index MoM (Dec): 1:30PM 
US Pending Home Sales MoM (Dec): 3:00PM 
US Revised UoM Consumer Sentiment (Jan): 3:00PM

Interbank rates*:

GBP/USD – 1.2372
GBP/EUR – 1.1369
EUR/USD – 1.0881
USD/CAD – 1.3339

 

Please contact your Dealer about any upcoming FX requirements you may have, or call +44 (0)20 3465 8200. 

*Indicative interbank rates taken on the day of writing. Please speak to your Dealer to find out the current rates available for you.