The Sterling has entered bouts of volatility on the back of political factors. Friday saw the GBP rise across the board as PM Cameron and the EU came to an agreement on the new relationship between the two parties. The gains were short lived as the Mayor of London came out in favour of the UK leaving the EU all together. Further volatility is expected in the GBP as new data regarding the future of the UK in Europe expected to have both bullish and bearish swings until the vote on the 23 of June, with some analysts predicting severe weakness in the GBP.
Data out of the Eurozone is expected to be the feature for today, in the face of relatively light data from elsewhere. The data expect is:
- French Flash Manufacturing PMI expected at 49.9
- French Flash Services PMI expected at 53.4
- German Flash Manufacturing PMI expected at 52.1
- German Flash Services PMI expected at 54.8
- EU Flash Manufacturing PMI expected at 52.1
- EU Flash Services PMI expected at 53.4
Crude oil remains the primary driver of both equity and currency markets as no clear outcome appears at hand regarding the oversupply from oil producers and their reluctance to cut outputs as each waits for a move from the other. Oil prices are expect to remain near their 13 year lows as demand continues to slide on the back of cooling global economies and the oversupply from OPEC and other producers.