Following its strong recovery in the latter part of last week, sterling failed to build on those gains yesterday and weakened against both the euro and US dollar.
With little data of interest yesterday, it looks to have been more of a correction from the exuberance of last week that dented sterling, but it remains 0.5% and 1.5% stronger than those respectively since this time last week.
In a speech yesterday the chief economist of the Bank of England (BoE) Huw Pill said that mid-2024 would likely see the first interest rate cuts.
Also influenced by its central bank, the big loser so far today has been the Aussie dollar, which has weakened by at least 1% against major rivals after the Reserve Bank of Australia raised rates by 25 basis points to 4.35% but cooled its outlook.
In business news, the serviced-office provider WeWork has filed for bankruptcy. Shares in several other property-related businesses suffered yesterday, due to worries over bond yields rising and making borrowing more expensive, dragging the FTSE 100 down too.
Construction PMI was down in the UK yesterday, but good news for homeowners today with house prices rising in October according to the Halifax House Price Index by 1.1%, an astonishing turnaround after September’s fall. This evening we’ll hear the RICS House Price Balance, a survey of surveyors’ hopes for the property market.
In the US, Donald Trump was in court in New York in a civil case. It has already been concluded that he committed fraud by inflating his net worth to do business on advantageous term, but he is now defending himself from paying huge fines and being banned from doing business in New York. Once again, it does not appear to be damaging his poll ratings for the presidential election, now under a year from now.
In UK politics, King Charles III is opening parliament today. Measures in the King’s speech that relate to business could include legal requirements for minimum service levels during industrial action, allowing driverless delivery vehicles by the end of the decade, and leasehold reform for renters.
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