5 Sep 2013
Flash: USD flows poised to dominate on Syrian action – Investec
FXstreet.com (Lisbon) - Uncertainty prevails in the US over how the two houses of the US government will vote next week on proposed military action in Syria, notes Jonathan Pryor, Corporate Treasurer at Investec.
Key quotes
“A 17 member US senate panel approved limited military action in Syria last night and the topic is set to be a serious topic of discussion at today’s G20 Summit in Russia. From a currency perspective we would expect to see safe haven flows dominate the markets should military action be approved, most notably in the form of USD and CHF strength.”
“Away from Syria the currency markets will be looking towards central bank announcements today. The Bank of England may provide additional rhetoric to strengthen their position on forward guidance. At present markets are pricing in interest hikes in two years’ time or so while Carney and the Bank of England are insistent that this will not happen until 2016.”
“If the markets do take heed, it could halt the pound’s recent gains against the Euro and US Dollar which has continued this week following a hat-trick of positive PMI data releases. Services PMI data yesterday released at 60.5 was the highest reading since December 2006.”
Key quotes
“A 17 member US senate panel approved limited military action in Syria last night and the topic is set to be a serious topic of discussion at today’s G20 Summit in Russia. From a currency perspective we would expect to see safe haven flows dominate the markets should military action be approved, most notably in the form of USD and CHF strength.”
“Away from Syria the currency markets will be looking towards central bank announcements today. The Bank of England may provide additional rhetoric to strengthen their position on forward guidance. At present markets are pricing in interest hikes in two years’ time or so while Carney and the Bank of England are insistent that this will not happen until 2016.”
“If the markets do take heed, it could halt the pound’s recent gains against the Euro and US Dollar which has continued this week following a hat-trick of positive PMI data releases. Services PMI data yesterday released at 60.5 was the highest reading since December 2006.”