Newsletter – 19 January 2017

Morning Bulletin


  • We saw sterling give back some of Tuesday’s gains against the other majors yesterday with GBP/EUR retracing by 0.44% and GBP/USD pulling back by 1.27%.
  • This was the case despite better than expected employment data from the UK. The average earnings index 3m/y beat expectations at 2.8% vs 2.6% expected, the unemployment rate matched expectations at 4.8% but the claimant count change exceeded expectations by coming in at -10.1K when 4.6K was expected.
  • US inflation data matched expectations with CPI m/m hitting the 0.3% estimate and core CPI at 0.2%.
  • Federal Reserve Chair Janet Yellen spoke last night in San Francisco and said that the US economy is near maximum employment with inflation moving towards their goal.
  • She said that it is expected that the federal funds rate target will be increased a few times a year until the end of 2019 – when it should be close to the longer-run neutral rate of 3%
  • Australian employment change came in better than expected at 13.5K vs 10.2K expected although the unemployment rate was slightly up on estimates at 5.8% vs 5.7% expected.
  • The World Economic Forum takes place today in Davos where we expect UK PM Theresa May to address world leaders on the topic of the apparent backlash against globalisation, liberalism and free trade.
  • The ECB is expected to keeping interest rates unchanged at 12:45 today with the press conference to follow at 1.30pm.
  • At 1.30pm, we also have data from Canada and the US which we have summarised in the data table below.


Current at time of distribution

Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1557 +0.21%
GBP/USD 1.2319 +0.48%
EUR/USD 1.0662 +0.30%
AUD/USD 0.7543 +0.52%


Current at time of distribution
Time (GMT) Region Data Release Forecast Previous
12:45 EUR Minimum Bid Rate 0.00% 0.00%
13:30 CAD Manufacturing Sales m/m 0.2% -0.8%
13:30 EUR Press Conference
13:30 USD Building Permits 1.22M 1.20M
13:30 USD Philly Fed Manufacturing Index 16.3 21.5
13:30 USD Unemployment Claims 252K 247K