Newsletter – 11th September 2017

Morning Bulletin

Friday

  • Sterling closed the week with a real surge on Friday, making solid gains against the Euro and US Dollar. Initially underpinned by some strong UK economic data but also assisted by a weakening Dollar later in the afternoon.
  • The economic data that lit the Sterling touch paper as it were included:
    • UK Manufacturing Production m/m 0.5% (0.3% Exp)
    • UK Goods Trade Balance -11.6Bn (-11.9Bn Exp)
  • That Manufacturing print was in fact the best since February and immediately saw Sterling rally from 1.0900 to 1.0950 against the Euro, whilst against the US Dollar it shifted upwards to test the 1.3200 handle.
  • The US Dollar Index slid to it’s lowest level since early 2015 during the morning session, touching a low of 91.01 as it remains weighed down by a combination of Geopolitical tensions and Hurricane concerns.
  • The UK NIESR GDP Estimate suggested UK economy grew by 0.4% in the three months ending in August. That was in line with their latest forecast for UK Q3 growth.
  • According to sources at the ECB, policymakers discussed four potential scenarios for QE in Thursday’s meeting. They agreed that a cut to stimulus was the next step but it should be done with the broadest possible consensus.
  • Canadian data continued to impress Friday afternoon, this time in the form of employment numbers. There were 22,200more people in work during August, that was up against an expected rise of 17,800. The official unemployment rate also fell to 6.2%; it was expected to remain at 6.3%.
  • Speaking Friday afternoon US Fed Member Dudley said he expects the negative impact from Hurricane Harvey to be temporary, adding Q3 GDP forecasts will probably be a touch lower.
  • Spain’s constitutional court has blocked the Catalan Independence referendum which is due to take place next month. However Catalan leaders insist the vote will take place on 1st October.
Over The Weekend
  • China CPI y/y 1.8% (1.7% Exp)
  • China PPI y/y 6.3% (5.7% Exp)
  • Japan Core Machinery Orders m/m 8.0% (4.2% Exp)
  •  Japan Prelim Machinery Tool Orders y/y 36.3% (28.0% Previous)
Today
  • Typical lack of data for a Monday, with no key data set for release.

 

Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.0978 +0.16
GBP/USD 1.3192 +0.03
EUR/USD 1.2015 -0.16
AUD/USD 0.8046 -0.09

 

Time (GMT) Region Data Release Forecast Previous
09.00 EUR Italian Industrial Production m/m -0.5% 1.1%
13.14 CAD Housing Starts 216K 222K