As it happens, they have generally continued to drift higher as the year end approaches. Not that there has been much in the way of news to drive shares significantly in either direction. True, the Brexit breakthrough could be considered a plus, though neither the FTSE 100 Share Index nor sterling was much affected by it.
Perhaps the most important domestic news recently is that inflation has hit its highest rate for six years. Since rising inflation has presaged an interest rate rise in the past, this news could have been a reason to push the pound up, but perhaps currency traders were out Christmas shopping at the time. Anyway, these numbers served as a reminder that wages continue to lag inflation, intensifying the squeeze on living standards, though if my local market town is anything to go by, people are still happy to go out and spend.
Company news is thin on the ground at this time of the year, a situation that will change rapidly once we enter 2018, with first the trading statements from retailers and then the year end results which seem to arrive earlier each successive year. There will be economic data to take on board during this festive season. Figures on average earnings and unemployment here at home will give us a steer on our economy. And there are numbers emerging from both the US and the European Union, but nothing too significant.
The most important news will be coming from the central banks. The Bank of England, the European Central Bank and the Federal Reserve Bank of America are all meeting in the course of a couple of days to announce interest rate decisions. In the case of the Fed, which meets ahead of the other two, it is a crucial meeting, with important policy announcements. It is also Chairman Janet Yellen’s final meeting before she steps down.
In the Eurozone and here at home, a “steady as she goes” approach appears the preferred option. We will also be seeing the Bank of England’s quarterly report, though whether that will contain anything of significance is debatable. Perhaps the best thing for investors to do is to settle in to the festive spirit and hope for no unpleasant surprises in the year to come. In the meantime, may I wish all of our readers a very Happy Christmas and as prosperous New Year as we are allowed. May you all be of good cheer.
