Wise money markets ride on as America looks to thrash out Fiscal Cliff deal

It was another rollercoaster day yesterday on the wise money markets with stock, equity and currency markets finishing in the green.Wise money markets ride on as America looks to thrash out Fiscal Cliff dealThe GB Pound/EUR finished below 1.23 and EUR/US Dollar finished above 1.32 as the euro continues to strengthen on the brightening picture in Europe.

GBP/USD has also continued to climb higher at over 1.6250 on hopes that politicians in America will thrash out a deal before the end of the year.

In the euro this morning, we had German IFO Business Climate Index which came in better than expected at 102.4 and is painting an increasingly rosier picture of the situation coming from Europe’s largest economy.

This coming after, credit ratings agency, Standard and Poor upgraded Greece from “Selective Default” to B Minus with a Stable Outlook in a sign that things may be looking up for the struggling nation.

In Sterling, nothing is expected from the MPC minutes but investors will be paying attention to the voting patterns of its 9 members for any indication on further monetary easing.

Yesterday, we had inflation data out which remained stubbornly high at 2.7% while growth remains anaemic with Eurozone headwinds remaining on the fore.

Tomorrow wes will be watching for the Retail Sales figure to see if the holiday season has given the UK a much needed boost after last month’s disappointing figures.

In US Dollar, we have a quiet day today with no data of note coming out today but the USD has weakened on apparent news that a US Fiscal Cliff deal could be imminent and save the country from the mountainous spending cuts and tax rises lingering from the Bush Administration.

Tomorrow the markets will be watching the US GDP and initial jobless claims with Existing home sales for a direction before the year comes to a close.

Tomorrow the Japanese interest rate decision will be announced and is expected to remain on hold at 0.1% but more aggressive stimulus measure are expected after newly elected Premier Shinzo Abe has vowed to end Japan’s 15 years of deflation and return the nation to growth and inflation.

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