There's not much reason to be optimistic about the U.K. economy for now. As rate-cut speculation increases, the pound will come under more pressure.
The yield advantage is the driving story in the pound gaining against the euro.
People now expect the ECB to hike in the first quarter, or even as early as December. This has been supporting the euro.
There's a lot of uncertainty in the market before the data.
In this environment, there's still going to be dollar strength. The economic data coming out of the U.S. is still very strong, and there'll still be more rate increases.
I will be focusing on the data this afternoon out of U.S. I think the risk is on the upside and could give the dollar a bit of support.
It's going to take quite a while for the BOJ to be able to act, even if consumer prices rise. The yen will continue to weaken for now.
The yen is hugely undervalued and I see it strengthening next year.
The market sees very little opposition from Japan so that opens the way for further declines in the yen. The yen is looking vulnerable across the board.
The dollar's got a lot of supportive factors going for it, at a time when we're not so sure elsewhere. The market's getting more and more confident about rate increases in the U.S. and that's making the dollar look good against everything.
