The Pound declined against the dollar and euro on Friday amid concerns over the fragile UK banking sector. London’s leading index the FTSE was up 0.8 percent after falling sharply earlier in the session. Investors are starting to price in a budget downgrade from British Finance Minister, Alistair Darling when he presents his pre-budget report next month.
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The Dollar made gains on Friday as news released that Dubai is attempting to delay accumulated debt. Dubai World, a state company of Dubai with $59 billion of liabilities, said this week it will delay repayment of its debt. The move caused investors to sell higher-yielding assets and move their funds back into the safe haven of the Dollar.
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The Euro made gains against the Pound while declining against the US Dollar on Friday. The Euro gave up most of the gains from the topside breakout the day before as risk aversion went through the roof. The unspecified nature of the current crisis is leading to a lot of volatility with many investors searching for clarification of banks exposure to Dubai Debt. In Eurozone news, European Central Bank member Ordonez stated that the “euro interbank market…has suffered greatly” as a result of the global financial crisis. While data released in the Eurozone recently saw November industrial confidence rose to -19 from -21 while November economic confidence improved to 88.8 from 86.1. Also, November consumer confidence increased to -17 from -18 in October.
Data released 30th November
UK 09.30 Consumer Credit (October)
UK 09.30 Mortgage Applications (October)
EU 10.00 Flash HICP (November)
US 14.45 Chicago PMI (November)