Newsletter – 19th February 2018

Morning Bulletin

Friday

  • Sterling currency pairs suffered a rough start to Friday’s trading. A morning slump started with soft UK data, with a Retail Sales print of just +0.1% in January, well down on the expected +0.5% rise.
  •  That soft data was then compounded by comments from the EU’s Chief Brexit Negotiator Barnier, who said the UK’s ‘Red-Lines’ in negotiations, including their positions on trade, customs and regulatory independence, was closing the door to any relationships modeled with Norway, Switzerland or Turkey. Barnier added that even a standard free-trade deal could be voted down if the UK opted to deregulate it’s labour, environmental or health laws.
  • Touching on the recent stock market drop, ECB member Coeure said market volatility was simply a fact of life. He added that the adjustment following the drop had been fairly orderly and spillover to the Eurozone, the impact on the Eurozone, had been largely contained to the equity market.
  • There was little in the way of other data released Friday morning, but there were a raft of US figures in the afternoon:
    • Building Permits 1.40M (1.29M Exp)
    • Housing Starts 1.33M (1.23M Exp)
    • Import Prices m/m 1.0% (0.6% Exp)
    • Prelim UoM Consumer Sentiment 99.9 (95.4 Exp)
  • The US Dollar enjoyed a rare positive day on Friday, with the Dollar index (Dollar against basket of number of major currencies) closing the day up some 0.9%. However that still left the Dollar down 1.2% overall on the week.
Over The Weekend

  • Speaking on the Andrew Marr show over the weekend, EU Parliamentary member Guy Verhofstadt said a UK trade deal with the EU would not be finalised before the Brexit deadline, instead that inside the withdrawal agreement will be a vision for what the future trading relationship might look like, with the actual details to then be thrashed out during the transitional period.
  • Japan Trade Balance 0.37Tn (0.14Tn Exp)
  • UK Rightmove HPI m/m 0.8% (0.7% Previously)
Today
  • As per most Monday’s we have a distinct lack of data set for release.
  • Please note today is a US Bank Holiday (President’s Day).
  • China will also be observing the Lunar New Year over the next three days.

 

Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1288 -0.16
GBP/USD 1.3998 -0.24
EUR/USD 1.2397 -0.09
AUD/USD 0.7919 +0.15

 

Time (GMT) Region Data Release Forecast Previous
09.00 EUR Eurozone Current Account 30.5Bn 32.5Bn
11.00 EUR German Buba Monthly Report
18.45 GBP BOE Gov Carney Speaks
21.45 NZD PPI Input q/q 0.3% 1.0%