Newsletter – 14th August 2017

Morning Bulletin


  • There was a disticnt lack of data released Friday morning, as such moves in FX space were fairly limited during that session.
  • There were some lower impact figures out of Europe early on in the form of Final Inflation:
    • German Final CPI m/m 0.4% as expected
    • French Final CPI m/m -0.3% as expected
  • Friday’s key data, and arguably one of the more anticipated figures of the week was US Inflation. The CPI m/m print showed Inflation rose by just 0.1% during July, short of the expected 0.2%. That meant Inflation y/y is running at 1.7%, still someway short of the US Fed’s 2% target.
  • The US Dollar was sold off in FX space following that weaker than expected inflation print, largely because this soft level of inflation could prove a barrier to any further Fed rate hikes this year.
  • Evidence of this came an hour later when US Fed Member Kaplan was speaking. Mr Kaplan said the Fed were making good progress towards full employment, but acknowledged inflation was running below their two-percent target. Adding that he would want to see more evidence of inflation heading toward that target before raising interest rates again.
  • Unsuprisingly US Fed Member Kashkari later reinfored those sentiments stating the soft inflation print supported his ‘Wait-and-see’ view. Kashkari has been the only dissenter against the Fed’s two rate hikes this year.
Over The Weekend

  • There was a rare moment of public unity between UK Chancellor Hammond and Trade Minister Fox over the weekend, with the pair agreeing there would be a fixed transitional period following Brexit. Further stating that Britain would not remain in the EU by the back door, with the UK set to be leaving the Single Market and Customs Union completely.
  • New Zealand Retail Sales q/q 2.0% (1.6% Previous)
  • Japan Prelim GDP q/q 1.0% (0.3% Previous)
  • China Industrial Production y/y 6.4% (7.1% Exp)
  • Complete lack of data today, with no high impact print set for release.


Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1006 +0.10
GBP/USD 1.2997 -0.08
EUR/USD 1.1808 -0.11
AUD/USD 0.7878 -0.17


Time (GMT) Region Data Release Forecast Previous
10.00 EUR Eurozone Industrial Production m/m -0.4% 1.3%
13.00 INR India CPI y/y 1.54%
14.00 EUR German Finance Minister Speaks