Newsletter – 26th September 2017

Morning Bulletin

Yesterday

  • There was very little in the way of economic data released yesterday, in fact the only print of any note was the German IFO Business Climate and that fell just short of expectations with a reading of 115.2 (116.0 Exp).
  • That number had very little bearing on the Euro, which was already under the pump in the morning’s trading following the disappointing German Parliamentary elections. Despite Angela Merkel and her CDU looking set for a fourth term, the Chancellor now faces a slightly tricky task of forming a coalition Government as their current coalition partners, the Social Democrats, have said they will go into opposition following their poor polling performance.
  • GBP/EUR did hit a day’s high of 1.1393, but closed the day at around  1.1356 (+0.60%).
  • The Euro consistently slid against the US Dollar over the course of the day’s trading, closing the day near a one month low of 1.1846 (-0.85%).
  • Speaking yesterday the EU’s Chief Brexit Negotiator Barnier once again reiterated the UK could only begin talks of a transitional agreement when the ‘divorce’ bill has been settled.
  • US Fed Member Evans stated he wants to see clear signs of wage and price pressures before supporting another rate hike. Mr Evans added that there has been little in the recent run of data to suggest inflation will reach the Fed’s 2% target anytime soon.
Overnight

  • Echoing those words from Fed Member Evans, US Fed Member Kashkari also stated he saw no need for a further interest rate rise as he sees no signs in recent data of inflation improving.
  • New Zealand Trade Balance -1235M (-825M Exp)
  • Japan SPPI y/y 0.8% (0.7% Exp)
  • New Zealand ANZ Business Confidence 0.0 (18.3 Previous)
  • German Import Prices m/m 0.0% (0.1% Exp)
Today
  • Complete lack of data this morning.
  • Key this afternoon will be the US Consumer Confidence reading at 3pm, followed by commentary from Fed Chair Janet Yellen at 5.45pm.

 

Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1400 +0.31
GBP/USD 1.3495 +0.25
EUR/USD 1.1837 -0.09
AUD/USD 0.7931 -0.04

 

Time (GMT) Region Data Release Forecast Previous
09.30 GBP High Street Lending 41.7K 41.6K
14.00 USD S&P HPI y/y 5.8% 5.7%
15.00 USD CB Consumer Confidence 119.6 122.9
15.00 USD New Home Sales 591K 571K
15.00 USD Richmond Manufacturing Index 13 14
15.30 USD Fed Member Brainard Speaks
17.45 USD Fed Chair Yellen Speaks