Newsletter – 20th June 2018

Morning Bulletin

Yesterday

  • There was very little data to sift through during yesterday’s trading.
  • The US Dollar continued it’s recent march in FX space however, making solid gains against its major currency counterparts once again this week.
  • GBP/USD traded down to it’s lowest levels since Mid-November at 1.3151, before closing the day fractionally higher at 1.3167, which represented a -0.58% decline on the day.
  • EUR/USD followed a similar pattern, closing the day down some -0.47% at 1.1567.
  • The Pound had contrasting fortunes against a number of its other major counterparts closing the day pretty much at the same levels it had opened.
  • Eurozone Current Account 28.4Bn (30.3Bn Exp)
  • ECB President Mario Draghi was speaking yesterday morning at the ECB’s central bank forum, with the key takeaway that monetary policy within the Euro-area would remain patient, persistent and prudent. Draghi said that whilst the economy continued to grow and inflation was returning toward their target, uncertainty was still permeating through the economic outlook.
  • The German IFO have cut their domestic GDP forecasts quite considerably:
    • 2018, +1.8% (+2.6% Previous)
    • 2019, +1.8% (+2.6% Previous)
  • US Building Permits 1.30M (1.35M Exp)
  • US Housing Starts 1.35M (1.31M Exp)
  • New Zealand Global Dairy Trade price index -1.2% (-1.3% Previously)
Overnight

  • The big story overnight is that of the United States withdrawing from the UN Human Rights Council, describing the organisation as ‘cesspool of political bias’. The US has however had an uncomfortable relationship with the council since its inception in 2006.
  • Reportedly North Korea’s Kim and Chinese President Xi have come to an understanding on issues including the denuclearisation of the Korean peninsula.
  • According to ECB Member Lane, there would need to be a sizeable shock in inflation within the Eurozone for the ECB to reverse their decision to end QE.
  • New Zealand Current Account 0.18Bn (0.05Bn Exp)
  • German PPI m/m 0.5% (0.4% Exp)
Today
  • Very little data set for release today.
  • Could see movement this afternoon with the world’s top central bankers due to take part in a panel discussion at the ECB forum in Portugal.

 

Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1368 -0.01
GBP/USD 1.3161 -0.09
EUR/USD 1.1575 -0.11
AUD/USD 0.7392 +0.18

 

Time (GMT) Region Data Release Forecast Previous
11.00 GBP CBI Industrial Orders Expectations 1 -3
13.30 USD Current Account -129Bn -128Bn
14.30 AUD RBA Gov Lowe Speaks
14.30 EUR ECB President Draghi Speaks
14.30 JPY BOJ Gov Kuroda Speaks
14.30 USD Fed Chair Powell Speaks
15.00 USD Existing Home Sales 5.55M 5.46M