Every day, I am convinced more and more that Alice in Wonderland is not a funny fairy tale, but a cruel description of English everyday life. Nigel Farage, who leads the Brexit party, hit his chest with a heel a few days ago and threatened to give a merciless fight to Boris Johnson, putting forward his candidates in all constituencies from which conservative candidates will be nominated. Given that their positions are largely similar in many respects, as conservatives favor an early withdrawal from the European Union, and the name of the Brexit party speaks for itself, it was clear to everyone that this would lead to a loss of votes of just conservatives, which gives Laborites a serious chance of victory. Therefore, yesterday, this same Nigel Farage said that he won't put the conservatives in the wheel and the candidates from his party will go to the polls only in those constituencies in which Tory's positions are already weak. It is clear that this seriously makes Boris Johnson's life much easier, as it increases the chances of conservatives to win. Although Nigel Farage himself called him a traitor to the Brexit case until recently and strangely enough, but such political change of shoes in a jump reassured many investors, as they greatly reduce the probability of all kinds of excesses in the form of a second referendum, which is inevitable in the event of a Labor victory. However, even if there will not be a referendum, then the strengthening of the positions of Jeremy Corbyn threatens with another delay of the process, which is a clear increase in uncertainty. As a result, the reversal in Mr. Farage's policies has led to an increase in the pound.
Although, yesterday, nothing foreshadowed sharp fluctuations for the simple reason that in the United States, they raised toasts for their veterans at that time. In addition, when the UK macroeconomic data was published, market participants were calm. But the data themselves were extremely disappointing. For example, industrial production, which until recently had decreased by 1.8%, slowed down its decline not to 1.3%, but to 1.4%. Of course, the dynamics are clearly positive, but the result still remains negative. Despite that, things are much more fun with GDP, since a preliminary assessment of the economic growth rates for the third quarter showed their slowdown from 1.3% to 1.0% with a forecast of 1.1%. It is worth recalling that in the first quarter, the UK economy grew by 2.1%. That is, on the face of just a rapid decline in economic growth. It is so fast that it will not leave anyone indifferent.
GDP growth rate (UK):
Speaking about today's day, market activity will clearly be higher. At least for the simple reason that today is a business day in the United States, which means that the number of bidders will increase significantly. Moreover, it is large players. However, with macroeconomic data today, things are not as good as yesterday. They are practically nonexistent. One can rely only on the data on the labor market of the United Kingdom, almost all of whose indicators should remain unchanged. The only thing that can change is the number of applications for unemployment benefits, which should decrease by 1.1 thousand. However, despite the generally positive nature of labor market forecasts, the pound has nowhere to grow, if only because of extremely weak GDP data and industry. Nevertheless, the market is still comprehending a new twist on the plot of the political drama unfolding in the UK. Lastly, do not exclude new sharp statements from certain politicians.
Number of applications for unemployment benefits (UK):
The euro / dollar currency pair continues to fluctuate within the psychological level of 1.1000, actually forming a small pullback / stagnation. It is likely to assume that the fluctuation with an amplitude of 15/20 points still remains for some time, and the tactics of work remain the same, analysis of the point 1.1050 for purchases and 1.1000 for sales.
After the recent rally, the pound/dollar currency pair found a resistance point in the region of 1.2880, where it entered the pullback stage. It is likely to assume that a characteristic overbought amid a jump is still present on the market, and fluctuations within 1.2845 / 1.2880 are still possible, where it is worth carefully monitoring price fixing points.
