Less than a fifth of a cent separated the euro from the week's joint losers, the US dollar and the pound. The single currency fell by an average of -0.5% against the other dozen most actively-traded currencies. There were two angles to the euro's problems. One was the Euroland economic data, which were more inclined to disappoint than to impress. Notably, fourth quarter growth for both the euro zone and Germany came in below forecast at a provisional 0.4%, lagging the United States' 0.5% and Britain's 0.6%. The other irritant was politics, with right-wing anti-EU candidates continuing to lead the polls in France and the Netherlands.
Where to now for the pound?...
Not the first time we have used that title, but that really is the question at the moment. As much as we don't like to keep saying it, the "Brexit" word and how it's done and when it's done, and what people say and how they say it, is going to play a part. Europe is not the steady ship we once thought it was, or they once thought it was. So it's really...what is to give first?
When the European Central Bank president attended the European Parliament's economic affairs committee Mario Draghi's observations were in line with what could have been expected. The ECB is not, as alleged by the White House, massaging the euro lower to satisfy Germany. The euro is not about to break up: it is "irreversible". Yet the scandal surrounding French presidential candidate François Fillon could leave the way open for the Front National's Marine Le Pen to take over the Élysée Palace and one of her campaign pledges is to take France out of the single currency.
This last week was not the highlight of sterling's long and chequered career. The pound lost one and a quarter euro cents and even contrived to give away a third of a cent to the US dollar. The euro put in an average performance in the middle of the bunch, staying fairly close to the franc and the yen.
Income tax and surcharges
The income brackets and tax rates for personal income tax remain the same as last year and are as follows:
First the Brexit referendum, then Donald Trump. In 2016, investors were surprised by events that pollsters and other experts said wouldn’t happen, although on both occasions stock markets swiftly recovered before reaching new highs.
Uncertainty and political risk remain key themes for financial markets in 2017.
Neither the British nor the Euroland statisticians had much to say for themselves. The monthly round of provisional purchasing managers' indices, in which the UK does not participate, indicated that activity in the €Z private sector continued at a decent clip in January even if not all of the readings met expectations.
With the Greek pensioners' bonus and the Italian banks' temporary liquidity discomfort quietly put to bed the euro went into the New Year looking steady, if uninspired. It ambled through the first week of 2017, enjoying some decent Euroland economic data without really celebrating them.
The purchasing managers' indices, which look at current and anticipated activity in the private sector, were mostly up on the month and better than forecast. Inflation was also higher than expected at a provisional 1.1%.