The last comment concentrated on the euro and how it is likely to be buffeted around by Greece. This was certainly the case on Friday, as overnight weakness to fresh lows for the week was reversed sharply on rumours of a swift end to the saga. That seems unlikely as the relevant parties seen so wide apart.
For the British pound, economic data (apart from employment) has been weak, as wages are squeezed and inflation rages. Thankfully for treasury departments the technical picture is somewhat benign as the currencies ebb and flow through statistics.
The weekly chart below shows how the market is trapped between a triangle formation. This is one of the few classic patterns I respect and it means that the market is in a sideways trend, until a weekly close beyond a line, or the market just continues sideways into next February.
Within the pattern my analysis of price and time has an inner range of 1.1580 above and 1.1170 below. A break of either suggests an attack on the relevant trend line and all four levels can be used as reference points of relevant hedging activity.
When it comes to the relationship between Europe and Britain – uniformity isn’t a word that currently springs to mind. And that’s not just a reference to Brexit. Whilst the Europe and Britain do find themselves in the midst of a political break-up – their monetary policies are also showing signs of divergence.
As anticipated, US organisations exited prime money market funds en masse following last year’s SEC reforms. AFP’s latest Liquidity Survey indicates what it will take to encourage them back.
A shortage of trained staff and a forecast declining labour market mean that radical reform will be needed to retain investors’ interest in the country, a report suggests.
Nine months on from the US tightening up regulation of money market funds (MMFs), organisations show little appetite for investing in prime money funds reports the Association for Financial Professionals.