Newsletter – 20th April 2018

Morning Bulletin

Yesterday

  • UK Retail Sales came in even weaker than expected for the month of March. Having been forecast to decline -0.5%, the actual print showed sales dipped by -1.2%. According to the ONS a large part of the slump can be attributed to the poor weather keeping many shoppers at home.
  • The Pound did briefly drop in FX space but quickly recovered and in fact began to regain some of the ground lost following Wednesday’s poor inflation print.
  • The Eurozone’s current account stood at 35.1Bn in February, that was more positive than the 32.3Bn expected.
  • US Philly Fed Manufacturing Index 23.2 (20.8 Exp)
  • US Unemployment Claims 232K (230K Exp)
  • The Euro has finally traded back up to levels against the Swiss Franc last seen prior to the Swiss National Bank’s decision to un-peg the currency back in January 2015. Incredibly Having dropped to as low as 0.9651, the rate hit 1.2000 yesterday afternoon.
Overnight

  • The Big story yesterday evening were comments from the Bank of England Governor Mark Carney which saw Sterling decline sharply in FX space. Speaking to the BBC, Governor Carney threw huge uncertainty on to a potential rate hike in the BOE’s meeting in May, stating that whilst a few interest rate rises would be needed over the next few years he did not want to get too focused on the precise timing. Markets had priced in as high as a 90% chance of 0.25% hike.
  • GBP/EUR plummeted by a cent from 1.1500 to 1.1400 following his comments, whilst GBP/USD followed suit plunging from 1.4200 to just under the 1.4100 handle.
  • According to Bloomberg the European Union are set to reject the UK’s most recent proposal for solving the Irish border issue. The Irish border remains a crucial issue and arguably the biggest obstacle to negotiations on a future trade deal.
  • Japan Tertiary Industry Activity m/m 0.0% (0.1% Exp)
  • Japan National Core CPI y/y 0.9% as expected
  • German PPI m/m 0.1% (0.2% Exp)
Today
  • Next to no data set for release this morning. This afternoon Canadian Inflation data will be in focus from 1.30pm.

 

Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1382 -0.25
GBP/USD 1.4039 -0.29
EUR/USD 1.2331 -0.10
AUD/USD 0.7701 -0.34

 

Time (GMT) Region Data Release Forecast Previous
10.30 GBP BOE Member Saunders Speaks
12.30 EUR ECB Member Weidmann Speaks
13.30 CAD CPI m/m 0.4% 0.6%
13.30 CAD Core Retail Sales m/m 0.4% 0.9%
15.00 EUR Consumer Confidence 0 0
16.15 USD Fed Member Williams Speaks