U.S. Federal Reserve policymakers acknowledged that the case to raise interest rates “relatively soon” has continued to strengthen according to the minutes of the FEDs last meeting which were released on Wednesday against a backdrop of an improving labour market and higher inflation. The U.S. Dollar maintained gains on Thursday with trading expected to slow down over the U.S. thanksgiving holiday.
Overall the US Dollar remained strong on the future protectionist trade policies the Trump regime is likely to implement next year. It is likely the US could slash taxes and boost spending to increase growth and push inflation higher.
There were no surprises in Wednesday’s Autumn Forecast statement, with the UK budget deficit likely to increase by an extra £122 billion by 2019/20. In addition GDP forecasts could reduce for 2017 and 2018 although Brexiteers argue the government are being overly negative.