Newsletter – 31st August 2017

Morning Bulletin


  • US economic data dominated yesterday afternoon, and both high impact releases were much better than expected, underpinning a rare solid day’s trading for the US Dollar of late.
  • ADP Non-Farm Employment was the first key number and the report showed that 237,000 jobs were created during August, well up on the expected 185,000. Further to that July’s previous 178,000 jobs figure was revised upwards to201,000.
  • The second key print was Prelim Q2 GDP data, and again the reported 3.0% growth smashed the expected 2.7% and was up on the first estimate of 2.6%.
  • These two prints provided signs that the US economy is still ticking over nicely, and as such the Feds Fund Rate priced in a 40% chance of another rate hike this year, up from 32% beforehand.
  • Despite a lack of UK data Sterling was also one of the day’s better performers making gains ranging from 0.12% against the US Dollar, up to 0.82% against the Kiwi Dollar. GBP/EUR was also up some 0.60% by the close of trading, having opened below 1.0800 the currency pair was trading at a day’s high of 1.0860 by 6pm.
  • A Bank of England report showed 69,000 new mortgages were approved in the UK during July, that was up on the expected 66,000.
  • According to Credit Ratings Agency Moody’s the Euro area is set to achieve above-potential growth over the next two years, as major economies accelerate and will be led by solid momentum in Germany.
  • Speaking yesterday, and much like a number of his Brussels counterparts, EU Brexit Negotiator Verhodstadt said he did not believe the UK had made enough progress or provided enough clarity on key issues to progress on to trade talks next month.

  • President Trump said that the US has totally surrendered its competitive edge and is hoping to renegotiate NAFTA, but will end it if not.
  • Japanese Prime Minister Abe has reiterated that the UK is an important base for Japanese manufacturing within Europe, and he has confidence in the UK economy post-Brexit.
  • Japan Prelim Industrial Production m/m -0.8% (-0.4% Exp)
  • China Manufacturing PMI 51.7 (51.3 Exp)
  • China Non-Manufacturing PMI 53.4 (54.5 Previous)
  • New Zealand ANZ Business Confidence 18.3 (19.4 Previous)
  • Australia Private Capital Expenditure q/q 0.8% (0.2% Exp)
  • German Retail Sales m/m -1.2% (-0.5% Exp)
  • European data firmly in focus this morning, with CPI the most anticipated print at 10am. Underlying Inflation has remained sluggish within the Eurozone and is expected to rise 1.4% y/y.
  • This afternoon there is a raft of data from North America. Canadian GDP and US Unemployment Claims are the key numbers to watch at 1.30pm.


Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.0851 -0.13
GBP/USD 1.2909 -0.11
EUR/USD 1.1897 +0.12
AUD/USD 0.7903 +0.04


Time (GMT) Region Data Release Forecast Previous
10.00 EUR Eurozone CPI Flash Estimate y/y 1.4% 1.3%
10.00 EUR Italian Prelim CPI m/m 0.2% 0.1%
10.00 EUR Eurozone Unemployment Rate 9.1% 9.1%
12.30 USD Challenger Job Cuts y/y -37.6%
13.30 CAD GDP m/m 0.1% 0.6%
13.30 USD Unemployment Claims 237K 234K
13.30 USD Core PCE Price Index m/m 0.1% 0.1%
13.30 USD Personal Spending m/m 0.4% 0.1%
14.45 USD Chicago PMI 58.7 58.9
15.00 USD Pending Home Sales m/m 0.4% 1.5%