Newsletter – 20th August 2018

Morning Bulletin

Friday

  • It was relatively quiet on the data front Friday, with just the two key pieces of economic data released Friday morning out of Europe and then a little gap before Canadian data in the afternoon.
  • The Eurozone’s current account surplus was slightly greater than expected at 23.5Bn in June. That was however slightly down on the 24.4Bn recorded in May.
  • Eurozone CPI y/y came in bang in-line with expectations at 2.1%.
  • Turkey’s retail sales grew at their slowest pace in 8 months during June. Perhaps unsurprisingly given the economic turmoil, retail sales grew 4.3% year-on-year which was down on the 5.1% recorded in May.
  • Canadian Inflation unexpectedly rocketed according to the CPI print Friday afternoon. Expecting a modest month-on-month rise of 0.1% in July, the actual figure of 0.5% meant inflation had risen by 3% on an annual basis, the first time it has reached that level since 2011.
  • The Canadian Dollar rallied aggressively in FX space, and there will now be far more pressure on the Bank of Canada to accelerate interest-rate rises. BOC Governor Poloz has stated that any rate increases over the next year would be gradual to avoid disruption to the economy.
  • Canadian Foreign Security Purchases 11.55Bn (4.91Bn Exp)
  • US Prelim UoM Consumer Sentiment 95.3 (98.1 Exp)
Overnight

  • Both S&P and Moody’s, two of the major credit ratings agencies, have downgraded Turkey’s credit rating. Soaring inflation and a lack of clarity from the Government were some of the main reasons for their decision.
  • According to the WSJ, negotiators from China and the United States are mapping out talks in an attempt to end the current trade stand off ahead of planned meetings between President Trump and Chinese Leader Xi in November.
  • UK Rightmove HPI m/m -2.3% (-0.1% Exp)
  • German PPI m/m 0.2% (0.4% Exp)
Today
  • No economic data set for release today.
  • We will hear from various central bank members this afternoon.

 

Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1154 +0.06
GBP/USD 1.2743 -0.03
EUR/USD 1.1420 -0.14
AUD/USD 0.7314 +0.01

 

Time (GMT) Region Data Release Forecast Previous
11.00 EUR German Buba Monthly Report
14.15 CAD BOC Member Wilkins Speaks
16.00 USD Fed Member Bostic Speaks
17.00 EUR ECB Member Weidmann Speaks
23.00 AUD RBA Governor Lowe Speaks