Has Donald Trumped himself? – 20th October 2016

Has Donald Trumped himself? – 20th October 2016

In last night’s Presidential race Donald Trump failed to agree that he will accept the result of the November 8th election. Although he did not say absolutely that this was his position, it didn’t go down well with Republicans or Democrats, enabling Clinton to take the lead in the race to the White House.

As for Clinton, well aware of the very strong support for Bernie Sanders during the Democratic nomination series back in the summer, is she starting to lean towards his welfare based economics? His support was very strong amongst younger more idealistic constituents and their draw may be too strong to resist. Although it won’t happen immediately, this could be a recession event further out.

In the UK, there are now 31.81 million people employed in the UK economy representing 75% of 16 to 64 year olds. With vacancies at 750,000 and the official unemployment number is 4.9%, we are getting pretty close to full employment. The remainers out there had forecast armageddon by now however, it would appear we are looking at a vibrant economy that is already casting Brexit fears aside.

The key ecostat today comes from the ECB, with the latest monetary policy meeting. After ECB President Draghi’s bold statement last month that tapering QE will start shortly, there are signs that a U-turn might occur. If any sign of weakness is shown here the €/$ could break below 1.0950 and quickly head toward 1.08. £/€ could also benefit toward 1.13. He starts testifying at 13.30 BST.

This evening UK Prime Minister Theresa May has dinner with the other EU heads of state in what could be a market moving event. Too much sabre rattling by Mrs May or by M. Hollande could see Sterling get to £/€ 1.20 or drop £/€ 1.10.