Newsletter – 28th July 2017

 

Morning Bulletin

Yesterday

  • The Spanish Unemployment Rate dropped to 17.2% in Q2, down from a previous 18.8% and bettering the expected 17.8%.
  • Eurozone M3 Money Supply y/y 5.0% as expected.
  • Sterling had managed to hold overnight gains against the US Dollar, hovering around the 1.3140 mark for most of the morning. This was further aided by a much better than expected UK CBI Realised Sales print with the reading of 22eclipsing the 10 expected. The survey showed the strong sales growth was driven by groceries and clothing sales.
  • The Pound however faltered during the afternoon session as the Dollar rallied across the board. Having traded as high as 1.3158, GBP/USD eventually closed the day down around 1.3070.
  • Despite opening the morning under severe pressure, following the FOMC Wednesday evening, the US Dollar was one of yesterday’s best perfomers with the US Dollar Index (US Dollar relative to basket of foreing currencies) wrestling itself back up from a 13 month low.
  • The release of the Atlanta Fed GDPNow Model was a big factor in the USD strengthening. The closely watched model raised US GDP expectations for Q2 to +2.8%, up from +2.5% just a week or so ago.
  • There were a few further key releases out of the US:
    • Core Durable Goods Orders m/m 0.2% (0.4% Exp)
    • Unemployment Claims 244K (240K Exp)
    • Goods Trade Balance -63.9Bn (-65.0Bn)
  • According to the UK’s Brexit Department good progress has been made on numerous issues in negotiations with the EU, and as such they are confident enough progress will have been made by October to advance talks to the next phase.

Overnight

  • Japan – Tokyo Core CPI y/y 0.2% (0.1% Exp)
  • Japan – Unemployment Rate 2.8% (3.0% Exp)
  • Spanish Flash CPI y/y 1.5% as expected
  • Spanish Flash GDP q/q 0.9% as expected
  • Swiss KOF Economic Barometer 106.8 (105.9 Exp)
Today
  • The bulk of this morning’s data has already been released out of the Eurozone.
  • This afternoon Canadian and US GDP will be in focus. Both to be released at 1.30pm.

 

Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1177 -0.09
GBP/USD 1.3072 +0.08
EUR/USD 1.1694 +0.16
AUD/USD 0.7973 +0.08

 

Time (GMT) Region Data Release Forecast Previous
TBC EUR German Prelim CPI m/m 0.2% 0.2%
13.30 CAD GDP m/m 0.2% 0.2%
13.30 USD Advance GDP q/q 2.5% 1.4%
15.00 USD Revised UoM Consumer Sentiment 93.2 93.1
18.20 USD Fed Member Kashkari Speaks