With Christmas day upon us and no sign of any snow, yesterday again saw the Pound continue to fall against the Euro and the Dollar, as cable hit fresh eight month lows and hit new two month lows against the Euro. A worse than expected UK public borrowing figure early yesterday did not help support Sterling, with the figure increasing to £13.6bn in November from a year earlier and casting doubts over whether the chancellor will meet his forecasts for borrowing in this financial year. Markets will now be looking at the UK’s final GDP Q3 reading tomorrow, where it is to remain constant at 0.5% and gauge if the UK is on track to hit its 2.3% growth target for this year.
The US released their final GDP figure for Q3 yesterday afternoon and came out at 2%, slightly above forecasts but still down from the previous estimate of 2.1%. This didn’t move the Greenback as the focus of the markets after the Fed raised rates last week is looking at when they will raise again. Already the forecasts are for this to happen after Q1 2016 and as long as the data hits expectations or exceeds this will only heighten the cause for another rise sooner.
Today the UK’s final GDP of Q3 is released this morning and is expected to remain with previous readings of 0.5%. Following this the focus turns to the US where durable goods are forecasted to drop to a negative 0.6% MoM and the core figure which excludes transport is also due to fall to 0.1%.