Global macro overview for 08/07/2016:
After Brexit, there might be more changes in sovereign credit rating in EU countries. Credit rating agencies (CRA) have to announce beforehand the days when they could change the ratings of the European Union's members. Usually, the sovereign credit ratings are not that much important for market participants as long as they meet certain criteria, but after Brexit, the criteria and ratings are likely to be adjusted. Scheduled possible changes, current rating and current outlook for the most important countries are:
- Moody's European Union (Aaa, stable), Netherlands (Aaa, stable)
- Standard & Poor's European Financial Stability Facility (AA, stable), Germany (AAA, stable)
-DBRS United Kingdom (AAA, stable)
The UK's credit rating is probably the most at danger after the Brexit vote, but so far none of the agencies have decided to adjust it yet. This situation might change in the nearest future. CRAs are expected to cut the UK's rating lower towards AA or AA+ level.
Let's now take a look at the EUR/GBP technical picture in the daily time frame. As anticipated before, bulls have managed to hit the weekly resistance at the level of 0.8585 and now the market trades just below this level. This is a clear bull market, so up trend continuation is anticipated. The next support is seen at the level of 0.8380.
