- The euro strengthened significantly yesterday following a strong GDP q/q figure from Germany. The quarterly expansion of 0.8% has adjusted the y/y rate to 2.8% from a revised 2.3% in Q2.
- The euro rallied against sterling and the US dollar following the data release.
- GBP/EUR fell by 0.7% after opening at 1.1236 and closing at 1.1158.
- EUR/USD opened at 1.1667 and closed just shy of 1.18 at 1.1797 representing a 1.1% move.
- UK inflation data came in slightly weaker than expected yesterday with CPI y/y coming in at 3% vs 3.1% expected and RPI y/y coming in at 4.0% vs 4.1% expected.
- GBP/USD continued to trade within its recent range between 1.3060 and 1.3190 opening at 1.3114, trading a low of 1.3073 before strengthening to close at 1.3165.
- US PPI m/m came stronger than expected at 0.4% vs 0.1% expected and Core PPI m/m also came in at 0.4% vs 0.2%.
- German ZEW Economic sentiment came weaker than expected at 18.7 vs 19.8.
- Japanese preliminary GDP q/q came in weaker than expected at 0.3% vs 0.4%. GBP/JPY is currently trading 148.88.
- Australian wages price index q/q was also weaker than anticipated coming in at 0.5% vs 0.7%. GBP/AUD is trading at its highest level since June, currently trading at 1.7374.
- The euro has continued to strengthen overnight following yesterday’s German GDP data.
- At 9.30am we expect average earnings index 3m/y, claimant count change and unemployment rate from the UK.
- Following that MPC member Broadbent is expected to speak at the LSE at 1pm.
- At 1.30pm all attention turns to the US with inflation and retail sales data due at 1.30pm.
|Currency Pair||Interbank Rate||% Change on Day|
|Time (GMT)||Region||Data Release||Forecast||Previous|
|09:30||GBP||Average Earnings Index 3M/Y||2.1%||2.2%|
|09:30||GBP||Claimant Count Change||2.0K||1.7K|
|13:30||USD||Core CPI m/m||0.2%||0.1%|
|13:30||USD||Core Retail Sales m/m||0.2%||1.0%|
|13:30||USD||Retail Sales m/m||0.0%||1.6%|
|15:30||USD||Crude Oil Inventories||-2.1M||2.2M|