Newsletter – 22nd November 2018

Morning Bulletin


  • In currency markets it was the ‘commodity’ currencies that were largely in focus Wednesday as oil prices plummeted and they followed suit accordingly, including the Aussie, Canadian and Kiwi Dollars. Jump forward 24 hours and they were some of the better performers in FX space yesterday as oil rebounded.
  • UK Public Sector borrowing hit a 3 year high for October according to figures from the ONS. Borrowing was at £8.8Bn in October, up from £7.2Bn last year and well above the expected figure of £6.1Bn. But put into context borrowing this year is still at its lowest level for 13 years as the Chancellor recently announced austerity is coming to an end.
  • The row between the EU and Italy regarding Rome’s proposed 2019 budget was firmly back in focus yesterday. The EU Commission said Italy’s budget fails to comply with EU rules and as such the country should face action in order to reduce its deficit.
  • However the EU’s posturing seems to be having little impact on the Italian Government, speaking just yesterday afternoon Deputy PM Matteo Salvini insisted they were not open to negotiations on the proposed budget deficit target of 2.4% of GDP in 2019.
  • It would appear Italy is not the only member on the naughty list, as yesterday Spain’s 2019 budget blueprint also came under fire from the European Commission. The EU warned of the risk of the Spanish economy deviating significantly from its medium term objectives which were established in the stability and growth pact.
  • There were a number of key US economic data releases yesterday afternoon, and for the first time in a little while they all fell shy of expectations:
    • Core Durable Goods Orders m/m 0.1% (0.4% Exp)
    • Unemployment Claims 224K (215K Exp)
    • Revised UoM Consumer Sentiment 97.5 (98.4 Exp)

  • Despite UK PM Theresa May’s last minute dash to Brussels yesterday afternoon, she was still unable to agree further key details on the UK’s future relationship with the EU following a meeting with European Commission President Juncker. Whilst the PM said ‘further progress’ had been made in a ‘very good’ two hour meeting, there are now doubts as to whether the EU Leader’s summit will still go ahead on Sunday.
  • One European Leader who has already threatened to boycott Sunday’s summit is German Chancellor Angela Merkel, with Ms Merkel insisting she will only attend if all negotiations are concluded in advance.
  • According to the OECD the World Economy has passed its peak and will face growing risks from trade wars and rising interest rates. The agency revised their Global growth forecast for 2019 down to 3.5% from a previous 3.7%.
  • Japan National Core CPI y/y 1.0% as expected
  • New Zealand Visitor Arrivals m/m 4.0% (-1.7% Previous)
  • Very little in the way of economic data set for release today.
  • Please be aware today is Thanks Giving Day in America.


Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1212 -0.10
GBP/USD 1.2786 +0.09
EUR/USD 1.1402 +0.17
AUD/USD 0.7243 -0.28


Time (GMT) Region Data Release Forecast Previous
12.30 EUR ECB Monetary Policy Meeting Minutes
13.30 CAD Corporate Profits q/q 1.0%
14.45 CAD BOC Member Wilkins Speaks
15.00 EUR Consumer Confidence -3 -3
15.30 CAD BOC Financial System Review