Over the weekend, Clinton’s campaign was given a huge boost as the FBI cleared her of any wrongdoing in their investigation of the latest batch of emails. FBI Director James Comey told Congress his agency’s review had found nothing to alter its original conclusion. In July, he said Mrs Clinton had been careless but not criminal in handling sensitive material on her private email server while secretary of state. Despite this, Trump is still polling well and the margin between the two is still incredibly close.
Last week, US labour data grabbed markets attention. Non-farm payrolls were forecasted at 175k and the reading missed expectations at 161k. However, market movement after this piece of high tier data was pretty limited as the numbers have not changed the markets view in regards to next month’s possible and still likely rate rise by the Fed. The US also had last month’s non farms revised higher and the headline unemployment rate dropped a point to 4.9%.
Last week also saw Super Thursday as the UK Parliamentary vote on Brexit was announced and the Bank of England released their inflation report and rate decision. Firstly, the Pound was boosted by a ruling from the High Court that ruled against the government in a lawsuit on whether triggering Article 50 to begin the Brexit process would require a vote in parliament. Sterling surged higher, busting through two key psychological levels on abating concern about hard Brexit. However, this process is far from over as the UK government plan to appeal the decision to the Supreme Court in December.
Shortly after the shocking news from the High Court, the Bank of England announced their interest rate decision and published the latest inflation report. The BoE voted unanimously to keep rates on hold at record lows of 0.25% and upgraded their growth forecasts. The hawkish data aided the earlier Sterling rally initiated by the UK Parliamentary vote. The UK’s growth forecast for 2017 increased to 1.4% from 0.8%, which is a record upward revision, whilst inflation forecasts also rose to 2.75% from 2%.
All eyes will be on Tuesday night/Wednesday mornings election when we see who will be elected President - Trump or Clinton. The first results are from Georgia, Indiana and South Carolina scheduled at 12am, results will then filter through the night but and the winner will be announced at approx. 04.00am UK time, with official announcement at 6am after Alaska. The polls are tied and the bookies at the moment have it Clinton 4/9 and Trump 2/1.
Markets continue to digest the US election results, with the last result from Alaska scheduled at 6am GMT. The Mexican Peso will be a currency to watch, as recently it has acted as somewhat of a TrumpOmeter. If Trump is elected Tuesday night/Wednesday morning we could see the Peso weaken off substantially, with some predicting historic lows for the currency. The Greenback could also suffer severe weakness if Trump is elected.
Another key piece of labour data released from the US this week. Last week’s non farms and unemployment rate posted healthy numbers, with unemployment falling to 4.9%. Can the jobless claims figure follow suit and help fuel the fire for a Fed rate rise next month?
A relatively quiet end to a very volatile and entertaining week. The only notable piece of high tier data released comes from the States in the form of US Michigan consumer sentiment.