Pound Rises Ahead Of BoE Carney's Speech
December 20 2017 - 2:51AM
RTTF2
The pound advanced against its major counterparts in European
deals on Wednesday, ahead of a speech from the Bank of England
Governor Mark Carney on the recent financial stability report to
Parliament.
Carney, along with other policy makers, will appear before the
Treasury Select Committee to discuss about the central bank's
financial stability report in November at 8:15 am ET.
In its latest Financial Stability Report, the BoE said that the
UK banking system is resilient to deep simultaneous recessions in
the UK and global economies and could withstand a "disorderly"
Brexit.
The International Monetary Fund welcomed the recent progress in
Brexit negotiations between the UK and EU and cautioned that the
timeframe to accomplish the tasks was ambitious.
Early agreement on a transition period would avoid a cliff edge
exit in March 2019 and reduce the uncertainty facing firms and
households, the IMF staff said concluding the Article IV
Mission.
Survey results from the Confederation of British Industry showed
that UK retail sales sustained its robust growth trend in the
run-up to Christmas and is expected to repeat the same next month,
but underlying conditions remained tough as the squeeze on earnings
continue.
The retail sales balance dropped to +20 in December from +26 in
November. That was less than the +30 balance predicted in the
previous survey, but in line with economists' expectations.
The currency showed mixed trading in the Asian session. While it
rose against the yen, it held steady against the franc and the
euro. Against the greenback, it dropped.
The pound climbed to a 2-day high of 1.3414 against the
greenback, from a low of 1.3377 hit at 2:00 am ET. If the pound
extends rise, 1.36 is likely seen as its next resistance level.
The pound spiked up to a 6-day high of 151.79 against the yen,
compared to Tuesday's closing value of 151.08. Further uptrend may
see the pound challenging resistance around the 153.00 region.
Data from the Ministry of Economy, Trade and Industry showed
that Japan's all industry activity increased as expected in
October, after falling in the previous month.
The all industry activity index rose 0.3 percent
month-over-month in October, reversing a 0.5 percent decrease in
September.
The pound that closed Tuesday's trading at 1.3180 against the
franc rose to a 2-day high of 1.3241. On the upside, 1.35 is
possibly seen as the next resistance for the pound.
The pound ticked up to 0.8829 against the euro, following a
decline to 0.8856 at 3:30 am ET. The next possible resistance for
the pound is seen around the 0.86 mark.
Data from Destatis showed that Germany's producer price
inflation eased to the lowest level in four months in November.
Producer price inflation slowed to 2.5 percent in November from
2.7 percent in October. This was the lowest since July, when prices
climbed 2.3 percent and also slower than the expected growth of 2.6
percent.
Looking ahead, Canada wholesale sales for October and U.S.
existing home sales for November are set for release in the New
York session.
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