Newsletter – 30th August 2018

Morning Bulletin


  • Sterling rallied yesterday following comments from the European Union’s chief Brexit negotiator Michel Barnier. Barnier stated the the EU was prepared to offer the UK an unprecedentedly close relationship after it leaves the EU.
  • Following a meeting with German foreign minister Heiko Maas, Barnier said “We are prepared to offer Britain a partnership such as there never has been with any other third country” but in a warning to the UK he also said, “We respect Britain’s red lines scrupulously. In return, they must respect what we are. Single market means single market… There is no single market a la carte.”
  • Barnier added that the proposed partnership could include economic and security policy ties.
  • GBP/EUR rallied from its opening rate of 1.1003 to close at 1.1126 representing a 1.11% increase in value of sterling vs the euro on Wednesday.
  • GBP/USD increased by 1.21% to rally from 1.2868 to 1.3024 – the highest closing rate in GBP/USD since the 1st August.
  • Preliminary GDP q/q in the USA came in better than expected at 4.2% vs 4.0%.
  • Canadian current account data came in weaker at -15.9B vs -15.3B.
  • US crude oil inventories came in at -2.6M vs -0.7M.
  • Governor of the Bank of England Mark Carney has reportedly been approached by the Government to stay on for another year, despite saying he would only serve six of a seven-year term (PoundSterlingLive). Ongoing stability and the current policy trajectory that his leadership provides is seen as a positive for the pound in longer term.
  • Scotland First Minister Nicola Sturgeon has spoken of her huge sadness following the reisgnation of former SNP leader Alex Salmond. Salmon resigned from his position yesterday following allegations of sexual misconduct, which he denies.
  • ANZ business confidence from New Zealand came in at -50.3.
  • Australian private capital expenditure q/q came in at -2.5% vs 0.6% and building approvals m/m also came in weaker than expected at -5.2% vs -2.2% expected.
  • GBP/AUD, GBP/NZD and GBP/JPY are currently trading at 1.7870, 1.9560 and 145.41.
  • This morning we had data from Switzerland in the form of the KOF economic barometer which came in at 100.3 vs 101.2 expected.
  • Spanish flash CPI y/y came in as expected at 2.2%.
  • At 1.30pm we will have the latest GDP m/m figure from Canada and personal spending m/m from the US.
Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1128 +0.02
GBP/USD 1.3000 -0.18
EUR/USD 1.1680 -0.21
AUD/USD 0.7284 -0.35


Time (GMT) Region Data Release Forecast Previous
13:30 CAD GDP m/m 0.1% 0.5%
13:30 USD Core PCE Price Index m/m 0.2% 0.1%
13:30 USD Personal Spending m/m 0.4% 0.4%
18:30 EUR German Buba President Weidmann Speaks