Sterling on fire!

The pound has strengthened notably against both the euro and the dollar, as the market takes comfort from the latest opinion polls which show the Conservatives will a still healthy lead over Labour just a week or so out from voting day in the general election (December 12th). Sterling has risen to its highest level against the single currency since the middle of 2017, trading just below 84.5p (with the market now eyeing 83.5p), and has appreciated to over $1.31 against the dollar, its best level since early May this year

Equity markets rebounded yesterday, and bond yields reversed some of Tuesday’s fall, driven by the latest headlines in relation to the US-China trade situation, with ‘people close to the talks’ reported as saying that a ‘phase one’ deal is still doable by the middle of this month

Boris Johnson has said that in the first 100 days of his government (if that indeed is what transpires), he will, among other things, have a Queen’s speech; “get Brexit done” by the end of January 2020; and introduce a budget in February (the Bank of England will be interested in what it contains as it contemplates its next steps in relation to monetary policy and interest rates)

The global manufacturing PMI rose for a fourth consecutive month in November, rising above the 50 expansion-contraction threshold in the process (though only just), and contributing to what Canada’s central bank noted yesterday was “nascent evidence that the global economy is stabilising” (while warning that trade policy remains the biggest source of risk to the outlook)

Data due today include a second estimate of GDP growth in the Euro Area in Q3 as well as retail sales for October, while in the US we get jobless claims, factory goods orders and the trade balance