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Happy New Year

Off to a good start

Sterling opens its account for 2019 an average of 0.2% higher than the levels seen on New Year's Eve. That is double the gain seen at the turn of the year 12 months ago. It might not be portent of things to come but at least the pound is not starting the new year with a loss.

It was probably not the prime minister's new year message that tipped the scales in sterling's favour. Her call to "put our differences aside and move forward together" was undoubtedly well-intentioned. However, there was almost a pantomime aspect to her assertion that "important though Brexit is, it is not the only issue that counts". You could almost hear the world's investors shouting back "Oh yes it is!"

Trade minister Liam Fox played a large part in sterling's Happy Monday. At the weekend he told the Sunday Times that if Parliament were to reject the prime minister's withdrawal bill there would still be a 50-50 chance of Britain leaving the EU. Investors figured that evens was a more attractive proposition than sure-fire certainty and they marked up the pound as London opened on Monday.

US manufacturing

Four of the US regional Federal Reserve Banks carry out surveys of manufacturing activity in their area, publishing the result as an index. The recent results have been less than unreservedly optimistic and Monday's, from the Dallas Fed, was no exception.

The Dallas Fed's manufacturing index swung from +17.6 to -5.1, a 28-month low. It mirrored the results from Richmond, where there was a 22-point fall to -8, and Kansas's 42-point drop. The other two surveys in New York and Philadelphia produced less spectacular results but they were still lower on the month.

And that was just about it for the new year's eve economic statistics. The only others were from South Africa, where private sector credit increased by 5.56% in November as money supply M3 grew by an annual 5.69%.

Day after New Year's Day

There will be many who cast an envious eye on New Zealand, where they are enjoying the creatively-named Day after New Year's Day holiday. For non-Kiwis the entertainment will take the form of manufacturing PMIs.

The first round of purchasing managers' index readings began in Australia, where the CBA measure improved from 53.7 to 54.0. Then came China, where the Caixin manufacturing PMI followed its CFLP partner into the sub-50 contraction zone at 49.7.

Spain kicked things off for Europe with a point-and-a-half decline to 51.1. And that could turn out to be the theme for the day: Analysts do not expect any of the readings to be higher on the month. They have pencilled in 48.6 for Italy, 49.7 for Italy, 51.5 for Germany and 51.4 for Euroland as a whole. Britain is supposed to beat them all with a 52.4 but that would still represent a half-point fall.

GBP boosted by trade minister

GBP boosted by trade minister

USD softer as manufacturing struggles

USD softer as manufacturing struggles

NZD lower as Kiwis relax

NZD lower as Kiwis relax

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