- Despite the release of a good number of high impact figures, yesterday proved relatively quite in FX space with the major pairs trading within a fairly tight range.
- The morning kicked-off with key UK data, Manufacturing Production for June came in at 0.0% as expected, so flat for the month. There was some good news however as the Industrial Production component rose 0.5% in June, smashing the expected 0.1% rise.
- Released at the same time the UK’s Goods Trade Balance with the rest of the world widened further during June. Expecting to see a trading deficit of £11.0Bn, the actual figure rose to £12.7Bn.
- Sterling was largely unmoved following the release of these figures.
- There was also key data out of the US yesterday afternoon, and once again it highlighted those growing concerns around inflation. The Producer Price Index (PPI) showed prices dropped by -0.1% during July against an expected rise of 0.1%.
- Inflation is of course a key consideration for the US Federal Reserve when weighing up any decision to hike interest rates.
- Speaking later in the afternoon US Fed Member Dudley stated that he and the Federal Reserve do expect the current sluggish inflation to rise over the next several months, whilst reinforcing his view of gradual tightening of monetary policy.
- US Unemployment Claims 244K (240K Exp).
- Canadian NHPI m/m 0.2% (0.5% Exp).
- According to the latest survey by WSJ of economists, 75% expect the Federal Reserve to raise rates in December.
- President Trump once again stole the headlines overnight, this time telling North Korea it should be ‘Very, very nervous’ if they were to do anything to the United States.
- Speaking overnight, Reserve Bank of Australia Gov Lowe said that growth had surprised to the upside recently, owing to a strengthening of the global economy since the RBA’s last meeting. He also reiterated that a further strengthening of the Aussie Dollar could cause a slower rise in inflation and slower reduction in unemployment.
- New Zealand Business NZ Manufacturing Index 55.4 (56.0 Previous)
- German Final CPI m/m 0.4% as expected
- French Final CPI m/m -0.3% as expected
- No data set for release this morning.
- US inflation print will dominate this afternoon. The CPI m/m print is expected to rise 0.2%.
- Worth noting that it is a Japanese bank holiday today.
|Currency Pair||Interbank Rate||% Change on Day|
|Time (GMT)||Region||Data Release||Forecast||Previous|
|13.30||USD||Core CPI m/m||0.2%||0.1%|
|14.40||USD||FOMC Member Kaplan Speaks|
|16.30||USD||FOMC Member Kashkari Speaks|