Sterling soared as along with the Scottish independence referendum and maintained gain as the "no" camp won. It's reported that 55% of voters rejected independence while 45% supported. Now that the risk is behind, BoE is seen to be back on track, and "business as usual" as some described. The central bank is seen to hike rate next year as recovery gather momentum. GBP/USD reaches as high as 1.6523 so far today comparing to this month's low of 1.6051.EUR/GBP powered through 0.7873 support and reaches as low as 0.7809 so far. Overall, the pound is seen strongest against yen this week, with GBP/JPY jumping nearly 500 pts and breached 180 handle.
Elsewhere, investors turned their focus to Eurozone as they gauged the implication of ECB's announcement that 255 European banks borrowed only EUR 82.6B at the first TLTRO. The market had anticipated a range of EUR 100-300b. The disappointing TLTRO take-up suggested the ECB might need to accelerate QE measures. The focus now is turned to the announcement of the 3-year LTROs repayment on September 24 as banks were given an opportunity to shift funds from the 3-year LTRO or MRO into the TLTRO. In other words, the repayment would indicate the amount of new liquidity that the ECB will inject via the first TLTRO.
The yen remains the weakest major currency this month. The government downgraded the overall assessment of the economy in September, that's the first downgrade in five month. The government noted that that private consumption appeared to be "pausing recently". The economy is still on course for a "moderate recovery", but "weakness can be seen in some areas". That's a contrast to BoJ's view published earlier this month as it's confident of a moderate recovery. A cabinet official, nonetheless, said there is no divergence in view.
On the data front, Japan all industry index dropped -0.2% mom in July. German PPI was unchanged at -0.8% yoy in August. Eurozone current account will be released in European Session. Canadian CPI will be the main focus in US session.