Newsletter – 20th December 2018

Morning Bulletin

Yesterday

  • GBP/EUR opened at 1.1126 and traded a low of 1.1061 before closing at 1.1085 representing a 0.37% decrease in the value of sterling against the euro on Wednesday.
  • GBP/USD fell by 0.19% on Wednesday .The market opened at 1.2634 and traded a high of 1.2679 before coming off to close at 1.2610.
  • UK CPI y/y came in as expected at 2.3%. PPI input m/m came in better than expected at -2.3% vs -2.9% and RPI y/y came in at 3.2% in line with expectations.
  • We also saw inflation data released from Canada.
    • CPI m/m was as expected at 0.4%
    • Common CPI also as expected at 1.9%.
    • Median CPI y/y and trimmed CPI y/y both came in weaker at 1.9% vs 2.0% and 2.1%, respectively.
  • The Federal Reserve in the US increased rates to <2.50% as expected in spite of warnings from Donald Trump against the move.
  • US President Donald Trump announced his decision to withdraw US troops from Syria declaring IS has been defeated. However, major allies have disputed the claim and a US-backed alliance in Syria have said the withdrawal will allow the IS group to recover.
Overnight
  • Australian employment change came in at 37.0K vs 20.0K expected but the unemployment rate came in weaker at 5.1% vs 5.0% expected.
  • The Bank of Japan held rates at -0.10%.
Today
  • UK retail sales came in much stronger than expected at 1.4% vs 0.3%.
  • The Bank of England are expected to hold rates at 0.75% at midday today with all MPC members  expected to vote to keep it unchanged.
Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1062 -0.21
GBP/USD 1.2693 +0.66
EUR/USD 1.1473 +0.86
AUD/USD 0.7139 +0.45
Time (GMT) Region Data Release Forecast Previous
12:00 GBP MPC Official Bank Rate Votes 0-0-9 0-0-9
12:00 GBP Official Bank Rate 0.75% 0.75%