Summary:
- Flynn reported to be willing to testify against Trump
- US stocks plummet alongside USD; Gold spikes higher
- CAD surges after stellar data
- ISM just misses forecasts (58.2 vs 58.4 exp)
- UK manufacturing PMI beats expectations
- Bitcoin on track for strong daily gain
A major surprise development at the end of the week has sent shockwaves through the markets as reports state that Michael Flynn would be willing to say that Donald Trump directed him to contact the Russians. The immediate reaction can be most keenly felt in stocks with the US500 dropping almost 2% as well as the USD sinking and Gold and bonds spiking higher.
A bunch of data from Canada has painted a much stronger than expected picture of the economy with both labour market figures and economic growth numbers rising and beating forecasts. The market reaction to this data has been quite clear with the Canadian dollar surging higher and it is currently the best performing currency in the G10.
The last significant economic data to be released this week has seen the ISM manufacturing reading for November drop by a little more than expected. A reading 58.2 was below the 58.4 forecast and the previous reading of 58.7. The decline was the second consecutive fall after the index peaked at 60.8 back in September and whilst it still remains at high levels historically speaking, traders will be watching closely to see whether the forthcoming reading are strong or whether there is a sustained decline similar to the one seen back in 2011.
UK manufacturing PMI unexpectedly sped up in the past month beating even the most optimistic forecasts of analysts surveyed by Bloomberg. The release showed a pick-up from 56.6 (revised up from 56.3) seen in October to 58.2 while the median estimate had pointed to just 56.5. On the surface it ought to be conducive to the GBP, however do notice that the currency has already had a remarkable performance over the course of the recent days and therefore the pound has remained on the back foot following the reading.
Bitcoin has enjoyed a solid day of gains so far at the end of what has been arguably the most dramatic week yet for crypto traders. It’s been the unbelievable week on the major cryptocurrencies as we’ve experienced incredibly chaotic moves up and down which in turn have led to new highs on Bitcoin, Litecoin (LTCUSD), Ethereum (ETHUSD) or Dash (DSHUSD).