esterday’s move, which was seemingly not driven by the release of any economic or political headlines, was likely the result of a so called ‘fat finger’ move in a period of lowered liquidity, similar to that during the ‘flash crash’ in October.

Earlier in the day, Prime Minister Theresa May spoke to the Confederation of British Industry (CBI) in London, warning that Britain’s EU exit negotiations would not be done quickly. Sterling traders will now look ahead to tomorrow’s Autumn statement. Chancellor Philip Hammond is expected to announce plans for an increase in infrastructure spending and a cut in corporation taxes, both of which could prove positive for the Pound.

With economic news relatively thin on the ground this week, attention in Europe has begun to turn to the Italian referendum in the first week of December. The referendum, aimed at pushing through a number of key constitutional changes that would slim down the country’s legislature and speed up lawmaking, is looking increasingly likely to yield a “No” vote.

A vote to reject the proposals is expected to lead to the resignation of Italy’s Prime Minister Matteo Renzi and would thus create an unwanted period of political uncertainty that could culminate in an early election in the country next year. The final opinion polls, released on Friday, showed the “No” vote marginally ahead at 41% to 37%.

Economic news is relatively light on the ground again today as markets await the release of the Federal Reserve’s meeting minutes on Wednesday evening. Eurozone consumer confidence and existing home sales in the US are the only economic announcements to look out for today.

Major currencies in detail:

GBP

Monday’s mysterious spike in the Pound sent the currency 1% higher for the day against the US Dollar.

All eyes were on Theresa May yesterday as she addressed the CBI conference. May claimed the government was working to avoid a “cliff’s edge” Brexit. In a move aimed at trying to boost business confidence ahead of the formal Brexit negotiation, she pledged to find an arrangement that would “work best for business in the UK”.

Political news remains the main driving force behind Sterling at present. Revised third quarter growth numbers on Friday will be the only significant economic release in the UK this week.

EUR

The Euro slipped 0.2% against the Dollar during the London session yesterday as political concerns and the growing likelihood of a Federal Reserve rate hike kept pressure firmly on the single currency.

President of the European Central Bank Mario Draghi spoke yesterday, although added little new information. Draghi claimed that the Euro-area economy was proving resilient, although the implementations of structural reforms needed to be “substantially stepped up”.

Investors brushed aside the news from Sunday that Germany’s Chancellor Angela Merkel is seeking a fourth term in office, which briefly provided support for the currency during Asian trading.

Consumer confidence at 15:00 UK time will be the only piece of economic data in the Eurozone today. Investors will await tomorrow’s business sentiment PMIs as the next major announcement in the Eurozone.

USD

The US Dollar was little changed on Monday, with the Dollar index hovering around its strongest position in nearly 14 years.

News was very light in the US on Monday. Federal Reserve policymaker Stanley Fischer spoke in New York. Fischer claimed that the US economy was performing well, although stating that low equilibrium rates and sluggish productivity were long term challenges for the US.

Meanwhile, the Chicago Fed National Activity index rose in October, although remained in negative territory. The index rose to -0.08 from a revised -0.23, although failed to move the markets in any way.

Liquidity is likely to be relatively thin in the US this week due the Thanksgiving holiday on Thursday. Housing data this afternoon is unlikely to rock the boat ahead of Wednesday’s FOMC minutes.

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