Sterling remains under pressure against the dollar, but steady against the euro in early trading. On Tuesday, the pound hit a 2021 low against a broadly stronger greenback, hurt by continuing Brexit worries. Yesterday, Maros Sefcovic, vice president of the European commission told reporters that talks between the EU and Britain on Northern Ireland trade rules will “probably” continue into the New year. This morning, the government said it is “disappointed“ by threats of protest action by French fishermen amid the escalating dispute over post-Brexit rights. The UK’s response comes after French fishing industry representatives signalled they could block Calais and other ports to stop exports to Britain. There was little market reaction to the closely watched PMI surveys yesterday which reported that businesses had their fastest growth alongside record cost pressures this month, since June.


The euro is under renewed pressure against the dollar despite upbeat PMI surveys from the Euro area and Germany released on Tuesday. The single currency is struggling as Covid cases continue to surge across the continent. Infections in France have risen by more than 30,000 in the past 24 hours, the highest in Europe, and Germany is considering new restrictions including the possibility of compulsory vaccines.


The dollar remains resilient against all its major peers, supported by the benchmark US Treasury bond yields which continue to rise. The Federal Reserve Bank will release the minutes from their last meeting tonight and markets will look for clues that they will speed up the taping of its bond-buying stimulus programme, which in turn could bring forward the timetable for raising interest rates. Also, of major interest today for traders will be this afternoon’s PCE (Personal Core Expenditure) report, which measures price changes in consumer goods and services. Other pre-thanksgiving data releases today include GDP estimates for the third quarter, durable goods orders, and initial jobless claims.

Economic Calendar

13.30 US Durable goods
13.30 US Initial Jobless
13.30 US GDP Prem
15.00 US CPE index
15.00 US Michigan Consumer Sentiment
19.00 Federal Reserve Bank minutes