Non farm payrolls released later today will promote additional volatility. The global economy relies on North American growth and the state of the American economy can be gauged by the number of payrolls issued.
The pound has managed a slight recovery against the Dollar due to strong fundamental UK data including the highest domestic manufacturing growth for 13 years. Fundamentally the UK economy is back in the game, independent financial reports from both the office of budget responsibility and the institute for fiscal studies have anticipated a recovery gaining pace into early 2011 but slackening towards the end of the year as public sector cuts are felt.
Manufacturing in the UK has benefitted from a weak pound, this might change as the economy picks up and the pound regains value. Fears over the levels of debt in periphery European nations still persist, this has also helped the Dollar and Swiss franc to gain some ground.
The Australian Dollar has suffered due to heightened risk aversion mainly antibuted to the European debt crisis but party due also to the threat of war between north and south Korea.
In the UK stock markets have staged a strong rally; the market was encouraged by strong manufacturing and growth prospects. Some high profile IPO’s are scheduled for early next year and the hedge funds are back to popping champagne and slapping each other on the back. Harsh public sector cuts will be introduced over the next couple of years and once in place they could help to smudge the perfect economic revival painted by the OBS/ Cameron alliance.
Canadian unemployment is unlikely to break the Loonie’s winning run when it’s announced later today unless the figure is really dire, Canada is benefitting from stable oil prices which make a lot of their reserves more viable.
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