Weekly Digest - INVESTEC
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Last week proved another one which investors will try and put from their minds, with a general retreat for equity markets rounded out by a 2% decline for the main US indices on Friday. The pound oscillated in a $1.24 – $1.27 range last week and is currently in the middle of this at $1.26; last week marked its fifth consecutive weekly decline.
This week, despite being pretty devoid of scheduled corporate newsflow, sees a lot of significant economic releases. First and foremost is the US central bank meeting on Wednesday, where the market is discounting a near certain fourth rate increase this year, taking it to a 2.25% – 2.50% range. The market’s focus on Wednesday evening’s conference will of course be on the outlook for 2019, where the Chairman has recently struck a much less hawkish note – the market is currently discounting just one or two moves.
Closer to home, the Bank of England’s Monetary Policy Committee meets on Thursday but is not expected to make any changes to policy, nor is the Bank of Japan’s monetary policy committee which meets on the same day. The scheduled corporate newsflow this week is limited to FedEx (market currently fretting again about the threat of Amazon Air), Carnival (insignificant Q4) and Nike. Other news over the weekend sees a breakthrough in the Italian budget deadlock, with Prime Minister Conte getting the backing of his Eurosceptic deputies to present a 2.04% budget deficit.