The Pound was little changed after Barnier's comments, as focus remained on the outline of Britain’s future trading relationship with the EU and whether the two parties will manage to secure a transitional period once the UK leave.

In the US, the Senate voted 51-48 in favour of the Tax Cuts and Jobs Act, with all Republican Senators supporting the bill, with the exception of John McCain who was unable to attend the session due to ill health. This followed an earlier vote by the House of Representatives which saw the bill passed by 227-203, though a Senate staff official subsequently ruled that three minor provisions in the measure needed to be removed. These were implemented in the version passed by the Senate, but now a re-vote will need to be held in the House of Representatives. This is scheduled to be held late this morning and is expected to be a formality. Assuming no further setbacks, the bill will then head to the President in order for it to be signed into law, an action that is expected before the end of the week. Providing the House passes the amended bill, there will be a news conference held at the White House today at approximately 6:00 P.M London time.

On the data front the German IFO business climate index came in at 117.2 in December versus the 117.5 consensus, while US housing starts were slightly higher than expected.

In other news, according to Forbes’s annual ranking, despite Brexit, Britain has been named the best country in the world to do business in 2018 for the first time ever. The UK came top of 153 countries ranked countries, having placed 5th last year. 15 factors, including property rights, taxes, technology, corruption, freedom and innovation were included with the UK scoring particularly well on technological readiness and education. 

The day ahead

As for the day ahead, we have Mark Carney speaking today and US housing data this afternoon to keep an eye on, in what is otherwise a relatively light data day.

Thought of the day

American poet Robert Frost famously once said ‘The best way out is always through’. Since June 23rd 2016 many UK businesses have found the going tough and with uncertainty over what the future holds causing a long term slowdown in investments the future remains uncertain. However here at Investec we haven’t yet seen the mass slowdown that many were expecting. This may well be down to a bit of that British Spirit and determination and here we are at the end of the year looking ahead to plans for what lies ahead.  If you would like to discuss in more detail please call the Investec Dealing Desk on 0800 055 6339.