The UK not out of Recession

[PhilBen]

The Pound Under pressure once again and according to Bloomberg UBS AG have said if the government tackles the country’s debt burden too early the pound could fall below parity with the Euro and drop to 1.05 against the US Dollar, the lowest level against the dollar since the 1980s. “If the next government was to prematurely curb the fiscal deficit after the elections, without the economy reaching a surer footing, the consequences for sterling, financial markets and public confidence would be grave,” Mansoor Mohi-Uddin, chief currency strategist at UBS in Singapore, said today in a research note. The question of when to start cutting Britain’s record deficit is at the centre of the campaign for the general election that Prime Minister Gordon Brown must call within weeks. Mohi-Uddin joins Nobel Prize-winning economists Joseph Stiglitz and Robert Solow, who are among 67 economists to support Prime Minister Gordon Brown’s argument that it’s too soon to start cutting the U.K.’s record deficit. They disagreed with 20 economists who attacked Brown’s position in a Feb. 14 letter to the Sunday Times.

The Dollar Figures from the Commerce Department showed yesterday in Washington that sales of new homes in the U.S. unexpectedly fell in January to the lowest level on record, another sign that an extension of a government tax credit may not be enough to increase demand. Purchases declined 11% to an annual pace of 309,000, from a 348,000 pace that was forecast. The median sales price dropped 2.4 % from January 2009 and the supply of unsold homes increased.

The Euro European Union’s statistics office in Luxembourg said yesterday that Industrial orders unexpectedly rose for a second month in December led by a surge in demand for capital goods such as machinery and equipment. Orders to industrial companies in the 16-nation euro area rose 0.8 % from November, when they gained 2.7 %, the. From the year-earlier month, industrial orders increased 9.5 %, the first annual gain since July 2008.

Major Data out Today
FR PPI
UK Total Business Investment (P)
UK CBI Industrial Trends
UK CBI Distributive Trades
US Durable goods orders
US Durables ex defence
US Durables ex transport
US Initial Claims
NZ Trade Balance

Live IB rates at 8.22am UK
GBP - EURO 1.136
GBP - USD 1.533
GBP - AUD 1.723
EURO – USD 1.349

[PhilBen]

The Pound An unexpectedly steep fall in UK business investment in the last three months of the year has again weakened the pound falling to a 9 month low against the Dollar and an 11 month low against the Yen. Even the Euro enjoyed a comeback. The overall status once again became a downturn for the troubled Pound against all but a few of the major currencies. The pound's broad falls pushed its trade-weighted index, which measures its value against a basket of currencies down to 78.8 =GBP, it’s weakest since mid-October. The Banks are in the frame again as RBS reports a loss of £3.6bn for 2009, but is set to pay bonuses totalling £1.3bn to its staff. Shortly Lloyds TSB will release what loss they have made and one can assume that they also will be paying bonuses to staff.

The Dollar U.S. stocks fell, and the Standard & Poor’s 500 Index erased yesterday’s rally, as Moody’s Investors Service said it may downgrade Greek debt and reports on American jobless claims and manufacturing orders trailed forecasts. Gains on the Pound however are again down to sterling weakness.

The Euro European confidence in the economic outlook unexpectedly worsened in February after the Euro region’s recovery almost stalled in the fourth quarter. An index of executive and consumer sentiment in the 16 nations using the Euro slipped to 95.9 from a revised 96 in January, the European Commission in Brussels said yesterday. The economic recovery may fail to gather strength for most of 2010, the commission said in a separate report. As with the Dollar any gains made concerning sterling are Pound Weakness.

Major Data out Today
DE CPI (P)
DE HICP (P)
EU HICP - Core (F)
EU HICP (F)
US Core PCE Price Index (P)
US GDP Annualized (P)
US Univ of Mich Sent. (F)

Live IB rates at 6.46 am UK
GBP - EURO 1.124
GBP - USD 1.527
GBP - AUD 1.715
EURO – USD 1.358

[PhilBen]

The Pound According to the Nationwide Building Society consumer confidence jumped in February to a two-year high after the economy was claimed to have left recession. However this probably won’t impact on the decline of sterling as 1.09 on the Euro is about to rear its head. The only thing that has prevented this from happening sooner is the poor data from Greese.

The Dollar broke below 1.50 last night against sterling and seems to be the currency in favour, alongside the Aus Dollar that that seems to have taken the correct steps from the beginning and stayed out of the global crisis.

The Euro fell to a 10 month low against the Dollar, however still gaining against the Pound. Greek Prime Minister George Papandreou said his government is discovering “new holes” in the budget on a daily basis as it prepares to announce as much as 4.8 billion Euros in extra deficit cuts.

Live IB rates at 8.42 am UK
GBP - EURO 1.098
GBP - USD 1.50
GBP - AUD 1.66
EURO – USD 1.365

[PhilBen]

The Pound BOE officials could keep their bond-purchase plan on hold today as the pound’s worst performance since October 2008 puts severe pressure on the UK recovery. Sterling has dropped 4 % against the dollar in the past month. Policy makers led by Governor Mervyn King are waiting for the 200 billion- pound program to take full effect on an economy trying to shake off the deepest recession on record.

The Euro The ECB may have to decide just how much it’s prepared to allow Greece dictate monetary policy for the euro region as a whole. As Greece’s struggle to cut its budget deficit and keeps the euro close to a 10-month low, ECB officials will today debate whether to slow the withdrawal of emergency measures used to fight the global financial slump. While Trichet says Greece won’t get special treatment, he will still have to plot a course that avoids unsettling markets further.

Major Data out Today
AU Trade Balance
CA Building permits
US Initial Claims
CA Ivey PMI
US Pending home sales

Live IB rates at 8.31 am UK
GBP - EURO 1.101
GBP - USD 1.503
GBP - AUD 1.669
EURO – USD 1.365

[PhilBen]

The Pound holds for the first time in days and we could see a close this week nearing the 1.11 against the Euro. However any small gains could be lost next week when a string of important data such as Visible Trade Balance and Retail Sales will be released. All eyes still remain on the contest between Gordon Brown and the Conservatives and I think Sterling will have plenty of stormy days to come.

The Dollar Less Americans than expected signed contracts to purchase previously owned houses in January, indicating the tax credit is doing little to encourage buyers. The index of purchase agreements, or pending house sales, dropped 7.6 % after a revised 0.8 % increase in December, the National Association of Realtors announced in Washington. Other reports yesterday showed factory orders increased and first-time jobless claims declined.

The Euro ECB President Jean Claude Trichet pressed Greece to halt its flirtation with the IMF (International Monetary Fund) aid and work with European allies to tame its record budget deficit. As protesters besieged the Greek Finance Ministry to denounce 4.8 billion Euros of tax increases and spending cuts, the Athens government said the absence of European support might force it into the hands of the IMF.

Major Data out Today
UK Input Prices (unadj)
UK Output Prices (unadj)
UK Output Prices Core (unadj)
US Hourly Earnings
US Non-farm Payrolls
US Unemployment Rate

Live IB rates at 5.17 am UK
GBP - EURO 1.106
GBP - USD 1.503
GBP - AUD 1.669
EURO – USD 1.359

[TFGtv.com]

Phil,

I don't particularly mean to appear rude or confrontational, but I fail to see how this daily cut-and-paste of information that is freely available elsewhere (i.e. Bloomberg) progresses the debate or benefits the forum...

Your original point was, in my opinion a very sound one; but I suspect most people who understand the implication of what Bloomberg et al publish are quite capable of accessing the site themselves...

If there were some additional comment or analysis by yourself I'd not be raising a figurative eyebrow... Are these posts leading up to sometihing?

[PhilBen]

Originally Posted by TFGtv.com

Phil,

I don't particularly mean to appear rude or confrontational, but I fail to see how this daily cut-and-paste of information that is freely available elsewhere (i.e. Bloomberg) progresses the debate or benefits the forum...

Your original point was, in my opinion a very sound one; but I suspect most people who understand the implication of what Bloomberg et al publish are quite capable of accessing the site themselves...

If there were some additional comment or analysis by yourself I'd not be raising a figurative eyebrow... Are these posts leading up to sometihing?

like every point of data sometimes we all print some of the same data or very similar when very little has changed or new has come out. Not all is as you claim and yes people do enjoy reading these posts. Where do you think data comes from. I sure the BBC never repeats the same news item as ITV. All news is copied at some point.

If some people don't want to view it don't click and read it. If the administrators don't won't me to post I will gladly stop.

[TFGtv.com]

That hardly answers my question...

[PhilBen]

I am not even going to respond to a pointless rude comment. Don't read them

[TFGtv.com]

Originally Posted by PhilBen

I am not even going to respond to a pointless rude comment. Don't read them

I don't believe I was at all rude to you nor was my comment (which in fact WAS a question) Pointless....

I basically asked you why you were posting the information you do on a daily basis. It is (as far as I can see) merely cut-and-paste from various easily accessible sources... And without further comment to it strikes me as, well adding nothing to the original point you made...

What IS the point of logging on to this board and simply re-gurgitating information without opening up a dialogue on or engaging in further comment? It IS a perfectly reasonable and relevant question? Or have I touched a raw nerve somehow?