There were no major data releases from the UK on Friday. Looking ahead to 2017, there are some fundamental issues which are likely to keep the pair under pressure for a long time during the year. The big headache for the pound would be the actual Brexit process. The courts have ruled that there needs to be a debate in the Parliament surrounding the invocation of Article 50 and it is likely that Parliament would like to have a say in every stage of the process. Then we have the issue of Scotland, which voted to stay in the Eurozone but now has to exit it as the whole of UK wanted to exit, trying to come up with plans to see how it can stay in the bloc while the UK exits it. If these are the internal issues which the UK government would need to sort out, then comes the actual matter of the negotiations with the Euro leaders on what would envisage the Brexit, what would be given, what would be taken etc.
In the US session Chicago PMI figures were released. The MNI Chicago Business Barometer fell 3.0 points to 54.6 in December from 57.6 in November, led by declines in both New Orders and Order Backlogs. After a disappointing start to the fourth quarter, the latest results suggest economic conditions have improved somewhat, with the Barometer averaging 54.3 in Q4, the highest in two years. The December decline was led by a slowdown in New Orders, which fell 6.7 points to 56.5, giving up most of the November gain that had left it running at the fastest pace since June.
There will be no major data releases from the UK tomorrow, and with holiday in USA we can expect a less volatile session.
