Newsletter – 12th October 2017

Morning Bulletin

Yesterday

  • GBP/USD posted gains for the third consecutive day yesterday closing up 20 points at 1.3222.
  • GBP/EUR gave back Monday’s gains falling to trade a low of 1.1121 and close at 1.1147.
  • UK Prime Minister Theresa May denied that she has been ramping up a ‘no-deal’ Brexit scenario with EU in yesterday’s Prime Minister’s Questions.
  • The Government have set aside £250m of new money to prepare for leaving the EU. The contingency funds will also be available should no deal with the EU be established.
  • The US dollar also lost ground on the euro yesterday with EUR/USD trading and closing at its highest level since late September. EUR/USD opened at 1.1807 and rallied 0.4% to close at 1.1858.
  • The North Korean Foreign Minister said US President Donald Trump has lit the wick of war with his speech at the United Nations and North Korea will make the USA pay with a hail of fire.
  • Spanish Prime Minister Mariano Rajoy yesterday heaped pressure on Catalonia President Carles Puigdemont by giving him 5 days to clarify whether the region considers itself independent.
  • If it does, it is likely that Rajoy will trigger article 155 of the Spanish constitution which would give Madrid previously unused powers to take control of Catalonia’s regional government.
Overnight
  • FOMC minutes were released last night and many participants though that another increase in the target range later this year was likely to be warranted if the medium-term outlook remained broadly unchanged.
  • GBP/AUD is trading at 1.6930, GBP/NZD is trading at 1.8622 and GBP/JPY is trading at 148.74.
Today
  • With the fifth round of discussions due to end, Brexit Secretary David Davis and the EU’s chief negotiator Michel Barnier are set to sum up the state of negotiations on Brexit later today.
  • At 9.30am the Bank of England will release the results from the credit conditions survey.
  • At 1.30pm we expect to see NHPI m/m data from Canada and PPI m/m, unemployment claims and core PPI m/m from the US.
  • Following that, ECB President Mario Draghi will be speaking at 3.30pm at the same time as FOMC members Brainard and Powell.
Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1165 +0.16
GBP/USD 1.3246 +0.18
EUR/USD 1.1864 +0.05
AUD/USD 0.7826 +0.50

 

Time (GMT) Region Data Release Forecast Previous
09:30 GBP BOE Credit Conditions Survey
13:30 CAD NHPI m/m 0.3% 0.4%
13:30 USD PPI m/m 0.4% 0.2%
13:30 USD Unemployment Claims 251K 260K
13:30 USD Core PPI m/m 0.2% 0.1%
15:30 EUR Draghi Speaks