Another volatile week has passed, with plenty of updates on Brexit and new restrictions around the UK. To begin with, all eyes were on the EU Summit this week (Personally I am not sure why, we all knew there was not going to be any breakthroughs this week)- and that is exactly what we got. No real progress on Brexit and both sides willing to take negotiations past the self imposed deadline of October 15th. This was then followed by a pretty Bullish Boris Johnson on Friday, stating that it seems the EU does not want a deal and that the UK should get prepared for a No deal outcome, this was of course was just posturing but that didn’t stop the Pound from dipping through Friday afternoon. Frost and Barnier (Chief negotiators for both sides) will be continuing with talks from Monday morning- which continues the optimism.
As Brexit talks continue, the UK has seen further restrictions come into play in London, Essex, Elmbridge, York and many others which is echoing the fact that Covid cases are rising fast again in the UK, unfortunately we are also seeing death numbers rise and the PM is not ruling out a “2 week circuit breaker” which looks quite realistic soon. The trick with the UK Government at the moment is they pretty much U Turn on everything they say, so if they say they wont do something- you can bet 2 weeks later they will change their mind.
As far as economic data releases are concerned, the main ones I will keep eye on this week are as follows;
- UK Inflation figures (Oct 21)
- ECB President Lagarde Speech (Oct 21)
- U.S Jobless Claims (Oct 22)
- UK Retail Sales (Oct 23)
- UK Manufacturing & Services PMI (Oct 23)
As this month is very close to finishing we must now begin to look at UK employment figures with furlough finishing at the end of this month, we don’t expect to see the impact straight away; in fact, I will be watching Dec/Jan numbers closely to begin to see the effect of this, less jobs will lead to less spending which will trickle its way down the economy very quickly.
Just a note I will not be in the (Home) office this week but my traders will be keeping an eye on my emails and taking and calls on my behalf- of course if you do wish to speak with me personally then I will be checking my emails from time to time and will come back to you.
Have a great week!