Newsletter – 28th September 2017

Morning Bulletin

Yesterday

  • There was a massive beat on expectations for UK CBI Realised Sales yesterday morning. Expecting a reading of just +6, the actual reading of +42 was the highest since September 2015, signalling a real resilience among UK shoppers despite rising inflation.
  • Sterling caught a bid following this data and traded to a day’s high of 1.1431 and 1.3429 versus the Euro and US Dollar respectively.
  • Eurozone M3 Money Supply y/y 5.0% (4.6% Exp)
  • Orders for durable goods in the US jumped to 1.7% in August against a forecasted rise of 1.0%; A marked increase in orders for commercial aircraft was a key factor.
  • US Pending Home Sales m/m -2.6% (-0.5% Exp). That was the fifth time in six months that sales on existing homes have been down on the previous month and fallen below expectations, with top realtors warning the housing market has stalled.
  • The US Dollar enjoyed a solid day’s trading all in all, still underpinned by Fed Chair Janet Yellen’s hawkish commentary Tuesday evening.
Overnight

  • The Reserve Bank of New Zealand kept rates on hold at1.75% as expected.
  • The RBNZ accompanying statement saw the Kiwi Dollar trading lower in FX space, as the central bank signaled they don’t expect to raise rates anytime soon as inflation slows and the outlook for economic growth weakens.
  • Contrasting views from two US Fed officials overnight:
    • Fed member Bullard said he saw no need for further rate increases anytime soon as inflation was unlikely to rebound quickly.
    • Whilst his colleague and fellow member Rosengren said regular and gradual tightening of monetary policy was warranted, suggesting the inflation shortfall was temporary but the improving unemployment trend isn’t.
  • German Gfk Consumer Climate 10.8 (11.0 Exp)
  • Spanish Flash CPI y/y 1.8% as expected
Today
  • Potentially quiet morning ahead. Markets will have half an eye on Bank of England Governor Carney who is due to speak at 9.15am.
  • Raft of US data this afternoon, with Final GDP and Unemployment Claims headlining at 1.30pm.

 

Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1394 -0.09
GBP/USD 1.3394 +0.07
EUR/USD 1.1752 +0.07
AUD/USD 0.7817 -0.38

 

Time (GMT) Region Data Release Forecast Previous
09.15 GBP BOE Governor Carney Speaks
10.00 AUD RBA Assist Gov Debelle Speaks
13.30 USD Final GDP q/q 3.0% 3.0%
13.30 USD Unemployment Claims 269K 259K
13.30 USD Goods Trade Balance -65.0Bn -65.1Bn
15.15 USD Fed Member Fischer Speaks