Eliman Dambell
Tradeview Markets
The British Pound rebounded on Monday, as the government scrapped plans to lower the top rate of tax.
Last week, Chancellor Kwasi Kwarteng lowered the top rate of tax from 45% - 40%, which would have been the lowest rate for top earners in the G-7.
However, following the reaction on markets, with GBPUSD falling to a historical low, he stated today, “We get it, and we have listened”.
He added that, “I can be frank, I know the plan put forward only 10 days ago has caused a little turbulence”
Kwarteng finally confirmed that, “It is clear that the abolition of the 45p tax rate has become a distraction from our overriding mission to tackle the challenges facing our country. As a result, I’m announcing we are not proceeding with the abolition of the 45p tax rate”.
GBPUSD rose to a one week high on the news.
WTI crude hits 12-day high on Monday
WTI crude was also higher to start the week, as markets began to anticipate a possible output cut.
This comes ahead of the Organization of the Petroleum Exporting Countries (OPEC) and its allies, which includes Russia (OPEC+) meeting this week.
It is expected that the cartel will potentially cut supply by up to 1 million barrels per day.
The meeting which will take place this Wednesday comes as oil prices have recently fallen, due to a stronger U.S. Dollar, and supply chain disruptions.
Should it happen, this will be the second consecutive cut, and the biggest since 2020.
As of writing, WTI is trading at $83.71.
Trading any financial instrument on margin involves considerable risk. Therefore, before deciding to participate in margin trading, you should carefully consider your investment objectives, level of experience and risk appetite. Most importantly, do not invest money you cannot afford to lose. Consulting with your investment counselor, attorney or accountant as to the appropriateness of an investment in margin trading is recommended. This electronic mail message is intended only for the person or entity named in the addressee field. This message contains information that is privileged and confidential. If you are not the addressee thereof or the person responsible for its delivery, please notify us immediately by telephone and permanently delete all copies of this message. Any dissemination or copying of this message by anyone other than the addressee is strictly prohibited.
Recommended Content
Editors’ Picks
EUR/USD trades sideways below 1.0450 amid quiet markets
EUR/USD defends gains below 1.0450 in European trading on Monday. Thin trading heading into the Xmas holiday and a modest US Dollar rebound leaves the pair in a familiar range. Meanwhile, ECB President Lagarde's comments fail to impress the Euro.
GBP/USD stays defensive below 1.2600 after UK Q3 GDP revision
GBP/USD trades on the defensive below 1.2600 in the European session on Monday. The pair holds lower ground following the downward revision to the third-quarter UK GDP data, which weighs negatively on the Pound Sterling amid a broad US Dollar uptick.
Gold price sticks to modest gains; upside seems limited amid USD dip-buying
Gold price attracts some follow-through buying at the start of a new week and looks to build on its recovery from a one-month low touched last Thursday. Geopolitical risks stemming from the protracted Russia-Ukraine war and tensions in the Middle East, along with trade war fears, turn out to be key factors benefiting the safe-haven precious metal.
Bitcoin fails to recover as Metaplanet buys the dip
Bitcoin hovers around $95,000 on Monday after losing the progress made during Friday’s relief rally. The largest cryptocurrency hit a new all-time high at $108,353 on Tuesday but this was followed by a steep correction after the US Fed signaled fewer interest-rate cuts than previously anticipated for 2025.
Bank of England stays on hold, but a dovish front is building
Bank of England rates were maintained at 4.75% today, in line with expectations. However, the 6-3 vote split sent a moderately dovish signal to markets, prompting some dovish repricing and a weaker pound. We remain more dovish than market pricing for 2025.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.