Newsletter – 27th March 2017

Morning Bulletin

Friday

  • Friday kicked off strongly for the single currency with a raft of better than expected data out of the Eurozone, including both German and French Manufacturing and Services PMI prints. That ultimately culminated in the improved aggregated Eurozone readings:
    • Eurozone Manufacturing PMI 56.2 (55.3 Exp)
    • Eurozone Services PMI 56.5 (55.4 Exp)
  • These numbers gave the Euro a real lift in the morning session, albeit the gains were fairly limited over the course of the day’s trading.
  • FRENCH ELECTIONS: Latest Opinionway poll: 1st round had Le Pen in front on 25% (Unch), with Macron on 24.0% (-1.0%). 2nd round still has Macron with landslide 63% to Le Pen’s 27%.
  • Sterling was one of the weaker performers Friday, with the Pound losing a bit of recent momentum following comments from the Bank of England’s Vlieghe. Typically a more dovish member of the committee, Vlieghe said that a rise in inflation would not prompt him to consider raising interest rates at the moment.
  • Key data releases Friday afternoon:
    • Canadian CPI m/m 0.2% (0.2% Exp)
    • US Core Durable Goods Orders m/m 0.4% (0.5% Exp)
  • US President Trump suffered his first big defeat Friday evening, as he failed to garner enough support from House Republicans on the ‘Affordable Health Care Act’ bill. Trump subsequently asked house leaders to cancel the vote and suggested the bill may not be discussed anytime again in the near future.

Over The Weekend

  • The US Dollar is on the back-foot in FX space this morning following President Trump’s defeat Friday evening. Markets and Investors are twitchy, with doubt now being cast on the ability of Trump to introduce those huge fiscal stimulus packages that he pledged during his campaign.
  • Japanese Services Producer Price Index y/y 0.8% (0.5% Exp).

Today

  • Largely quiet day in prospect with the only data of note chalked up for release at 9am.
  • That data comes in the form of German Business Confidence, and also Eurozone Money Supply.
  • Worth noting we are of course expecting Theresa May to invoke Article 50 this Wednesday.

 

Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1560 +0.13%
GBP/USD 1.2564 +0.74%
EUR/USD 1.0865 +0.64%
AUD/USD 0.7631 +0.12%

 

Time (GMT) Region Data Release Forecast Previous
09.00 EUR German IFO Business Climate 111.2 111.0
09.00 EUR Eurozone M3 Money Supply y/y 4.9% 4.9%
09.00 EUR Eurozone Private Loans y/y 2.3% 2.2%
18.15 USD FOMC Member Evans Speaks
23.00 AUD RBA Assist Gov Debelle Speaks
23.30 USD FOMC Member Kaplan Speaks