UK GDP and Norges Bank in the limelight – SocGen

Kit Juckes, Research Analyst at Societe Generale, suggests that this morning’s main events (before ht thrill of US durable goods orders) comes from Riksbank and NorgesBank policy decisions, UK Q3 GDP data and Eurozone money supply figures.

Key Quotes

“The Riksbank has just announced that policy is left on hold but they are still dangling the carrot of further bond purchases before the market, and pushed down growth and inflation projections. The Riksbank’s policies have now weakened the Krona so much that it has fallen, in real terms, against every other G10 currency over the last 20 years, including both the yen and the pound. But it’s not a convincing buy until the central bank changers course.

The Norges Bank is also likely to leave rates on hold, but NOK is supported by the recovery in oil prices, however slow, and by market expectations which price in more easing than is projected b the Norges Bank. So I’ll scratch my head on Sweden but I like NOK longs vs. GBP and CAD.

As for the UK data, a 0.3% q/q rise would leave annual growth steady at 2.1% and tells us nothing at all about the medium-term implications of the vote to leave the EU. I’m not sure how the pound is supposed to react beyond gyrating furiously without really going anywhere until we get some more meaningful news.”