Sterling gained against the US dollar on Friday afternoon in the wake of increased risk appetite following on from last week’s EU summit. The announcement that bondholders would take a 50% cut and that the EFSF would be boosted was given a positive endorsement by the markets, yet there are still further risks to come. The week ahead in the UK will see growth come back under the spotlight. Business surveys and the first estimate of 3rd Quarter GDP are expected to point towards to a weakening outlook, but last week saw improving figures on public finances which validates the coalition’s austerity measures. Volatility is expected to remain high so call in now for a live exchange rate.

In the euro zone, the big news of last week was the EU summit which – after being postponed – delivered on its main goals; agreement from bondholders on a 50% ‘haircut’ to repayment amounts and an expansion of the EFSF. However, with little detail announced over the implementation of these measures, some analysts remain anxious. Growth will be back on the agenda in Europe as well this week with a G20 meeting and region-wide business activity figures. Ensure you don’t lose out and speak to one of the team today.

In the USA, last week saw solid 3rd Quarter GDP growth figures and the coming week is expected to show improving manufacturing surveys. We also have the Federal Reserve’s monthly meeting and while no changes to monetary policy are expected, the meeting will give a good assessment of the Fed’s stance on the current outlook/ risks facing the US recovery. Friday sees the release of non-farm payroll data – a potential market mover. Call in to ensure you are protected.

Elsewhere, the Japanese government intervened over the weekend to weaken its currency after it hit a post-war high against the US dollar. The moves saw the currency weaken by as much as 5% as authorities moved in to prevent Japanese goods from being prohibitively expensive. Call in now for a live exchange rate.

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