After a large planned event, which was the publication of US GDP for the third quarter market got a series of important unplanned information: the resumption of the investigation concerning Hilary Clinton mail affair, leaks about the collapse of weekend OPEC talks and suggestions that this Thursday in addition to the decision on the monetary policy of the head of the Bank of England mr.Carney will also announce whether he intends to remain in office until the end of the term of office in 2018.
US economic growth in the third quarter managed to surprise the market positively, but it’s hard to see the reaction in the course of trading the dollar and the US stock market. The problem turned out to be the ingredients that contributed to this increase: American consumers failed to increase consumption and that behaviour constitutes the backbone of economic rebound – the situation did not improve that the survey confirmed the deterioration of sentiment in the first month of the fourth quarter. It extended to a period in which the investments are not able to support growth. The acceleration of growth was based on the increase of inventory and it does not give a sense of the sustainability of this rebound.
More important impetus for the dollar and Wall Street turned out other unplanned event – information from the head of the FBI to reopen the investigation reg. Democrats mails candidates a week before the presidential election. There was also a deterioration in surveys for Clinton. USDMXN fired 30 figures in the top noting that the currency pair is a trading barometer of Donald Trump.
Other unscheduled reports essential for markets were leaks from working meeting of OPEC, Iran and Iraq allegedly withdrew support for the September agreement to reduce the supply of oil. Although naturally it struck in the price of crude oil – commodity currency based on the raw material generally didn’t react.
The third unplanned event of a potentially large power for currency market, particularly for pound, is Thursday’s meeting of the Bank of England. Theoretically, the Bank has to show the new projections for growth and inflation, and there is a good chance to pull them up (the August frightened by the severe downturn in economic caused by decision to Brexit).At the same time Mark Carney said that there are limits of tolerance to increase inflation by the weaker GBP. It seems that the pound will be supported by what has to communicate the Bank of England. However, one should take under consideration the lack of a positive response of pound on better than expected GDP data for the third quarter. And on reports that the head of the BoE has another important announcement – is he going to stay on the position until 2018 or will take the opportunity from a provision in the contract allowing him to step down just now.
In view of the reported earlier pressure from the Prime Minister May received as an attack on the independence of the central bank that the BoE shouldn’t threaten with Brexit probability of Carneys resignation is regarded as non-zero.
Gold remains at the levels of the last two days, although you may see less volatility today. Reduced liquidity in view of tomorrow’s holiday can make the response to possible deviations from the expectations published today the preliminary estimate of inflation for October can come another time. For the euro we have to pay around 9:30 4.3318 PLN, for $ 3.9521PLN, the British pound and cost zł 4.8145 Swiss franc 3.9961 zł.