Currency markets took a while to get going to start the week with major pairings moving little amid sparse economic news and a general tone of caution.
GBP/EUR was almost flat on Monday across a tight range. Sterling and the euro did both lose under 0.5% to the US dollar, which continues to repel advances ahead of the incredibly tight US election two weeks from today.
UK public sector borrowing shot up to over £16bn in September, higher than official forecasts of around £15bn but lower than the £17bn economists projected. Whatever the predictions, the fact is that is that public sector net debt is now at its highest since the 1960s, giving chancellor Rachel Reeves another headache before next week’s autumn budget.
Risk appetite slipped to begin the week as whatever faint hopes of an imminent ceasefire in the Middle East became ever more distant. For now, this environment is helpful for the US dollar, yet with the presidential elections just two weeks away, there is bound to be some last-minute nerves as the reality of either candidate’s victory starts to take hold.
The International Monetary Fund (IMF) and the World Bank have their annual meeting this week, which is helping to attract bankers, policymakers and investors away from their usual grind of economic news. European Central Bank (ECB) president Christine Lagarde will make two appearances today, first in an interview with Bloomberg and later in a panel discussion at the event.
Moldovan voters have given the green light for its government to commence talks to join the European Union, although only by a slim margin. The vote marked a fraught political moment in which voters narrowly backed pursuing a closer union with the West, as opposed to returning under the influence of Russia.
Volkswagen’s UK arm has been ordered to pay £21.5mn in compensation to borrowers. The Financial Conduct Authority (FCA) ruled that over 100,000 customers had suffered from unfair financing decisions, which included repossessing vehicles from carers and people who had attempted suicide.
Make sure any upcoming transactions are protected against the risks of sudden market movements. Secure a fixed exchange rate now with a forward contract; call your account manager on 020 7898 0541 to get started.
