The move higher in the Pound seemed logical up to about two cents ago, but now seems a little on the high side given the work the government will have to do following the withdrawal bill passing through parliament. Most notably, the biggest piece of work we think they’l have to do is to agree an extension to the withdrawal timetable as the timeline of getting it all agreed within a year just isn‘t realistic. Boris has got a better chance of doing this with a large Tory majority that he would with a thin one that could need some help from elsewhere in the House of Commons. If he gets the majority that some of the polls are thinking he will, then another few cents higher might well be on the cards.
Across the Channel; France is trying to get those on strike back to work by saying that they’ll roll out their pension reforms much more gradually than they had planned to do so. Today will be day five of transport strikes that has brought travel chaos, closed schools and is having a very unwelcome effect on Christmas spending. President Macron’s team are due to unveil their final plans on Wednesday this week, so a few more days of strike pressure could well see those plans adapted ahead of the presentation.
Reuters is reporting that tech firms could be forced to share financial data of customers with banks and other financial institutions to prevent them beating the banks at their own game. Regulators are worried that big tech firms’ natural advantage when it comes to the sort of consumer data that they hold will be highly detrimental to the banks already servicing the space and though the technology will give much wider access to those under-served by current financial services providers, it could crimp the profits of banks and that could cause wider systemic issues.
On Friday we saw US job creation numbers on an absolute flyer. The number smashed expectations and is likely to give the Fed all the ammo it needs to justify it’s ‘wait and see’ strategy on interest rates. This won’t go down well with Trump who is desperate for further cuts to boost markets whilst his China deal is still a way away from being signed.
Trump’s latest focus is North Korea, where he has warned that he and Kim Jong Un might lose their ‘special relationship’ over Pyongyang’s announcement that they carried out a “successful test of great significance” The Guardian has more.
There’s only really one item on the agenda this week – annoyingly we’re going to have to wait until late Thursday/early Friday before it’s over and done with!
Have a great week