Newsletter – 1st December 2017

Morning Bulletin

Yesterday

  • Eurozone CPI was the only data of any significance released yesterday morning and it slightly dissapointed with the reading of 1.5% falling short of an expected rise of 1.6%. Weak inflation remains a concern for the ECB.
  • The overall Eurozone Unemployment rate fell to 8.8% in October (8.9% Exp).
  • Sterling continued to surge higher over the course of yesterday’s trading underpinned by recent reports that a Brexit settlement figure could have been agreed and more recently that a deal on the Irish Border could be in place.
  • The Pound surged to a days high of 1.1392 against the Euro, but closed the day down at 1.1352 (+0.34%).
  • Whilst against the Dollar the Pound traded to a fresh 8-week high of 1.3548, but also pulled back to close the day around 1.3510 (+0.75%).
  • The US Dollar was in fact under pressure across the board yesterday afternoon following reports that a vote on the GOP Tax reform Bill could be further delayed. Republican Senators are now hopeful of getting the Bill passed by Friday afternoon/evening.
  • Credit Ratings Agency S&P have raised Eurozone GDP forecast to +2.3% this year, and +2.0% for 2018.
  • US data proved pretty solid yesterday afternoon:
    • Unemployment Claims 238K (241K Exp)
    • Personal Spending m/m 0.3% (0.2% Exp)
    • Chicago PMI 63.9 (62.2 Exp)
  • Any pretenses that the Irish Border issue was settled might have been premature however, as speaking yesterday afternoon Ireland’s Foreign Minister, soon to be Deputy PM, Simon Coveney said the UK needed to provide ‘significantly more clarity’ on its plans for the Irish border.
Overnight

  • According to latest Reuters Poll the chance of a ‘disorderly’ Brexit is down to 25%, down from 30% in an October Poll.
  • Reuters are reporting that a senior EU official confirmed that an offer on the Brexit Bill has been agreed, and although it is ‘unofficial’ at this point, it would take a last minute complete turnaround to fall through.
  • China Caixin Manufacturing PMI 50.8 (51.2 Exp)
  • Australia AIG Manufacturing Index 57.3 (51.1 Previous)
  • Japan Unemployment Rate 2.8% as expected
Today
  • UK Manufacturing PMI is the key print this morning at 9.30am.
  • Raft of Canadian Employment data and GDP will be in focus this afternoon.

 

Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1314 -0.43
GBP/USD 1.3507 -0.14
EUR/USD 1.1932 +0.24
AUD/USD 0.7586 +0.29

 

Time (GMT) Region Data Release Forecast Previous
09.00 EUR Eurozone Final Manufacturing PMI 60.0 60.0
09.30 GBP Manufacturing PMI 56.6 56.3
13.30 CAD Employment Change 35.3K
13.30 CAD GDP m/m -0.1%
13.30 CAD Unemployment Rate 6.3%
14.30 USD Fed Member Kaplan Speaks
15.00 USD ISM Manufacturing PMI 58.4 58.7
15.00 USD Construction Spending m/m 0.5% 0.3%
15.15 USD Fed Member Harker Speaks