Newsletter – 31st August 2018

Morning Bulletin


  • UK data kicked off trading yesterday morning and it was slightly contradictory. On the one hand the M4 Money Supply print showed there was a far greater supply of money into the system in July, up 0.9% (0.2% Exp), but on the other hand British consumers borrowed at their weakest pace in two years with only £4Bn of new credit issued during July against an expected £5.5Bn.
  • Speaking yesterday morning German Finance Minister Scholz urged Europe not to adopt a ‘Europe First’ policy in response to the current global trade climate. On Brexit Scholz added that it was hard to say if a deal with the UK would be reached.
  • Canadian GDP growth was flat on a m/m basis during June (0.1% Exp), however the overall second quarter showed growth accelerated by 2.9% on an annualised basis, the fastest pace in a year, driven by a surge in exports.
  • US Personal Spending m/m 0.4% as expected
  • US Unemployment Claims 213K as expected
  • Following it’s rally off the back of Barnier’s Brexit comments Wednesday the Pound performed solidly yesterday making decent gains against most of its major counterparts with the exception of the US Dollar.
  • The Argentine Central Bank raised interest rates to an eye-watering 60% yesterday afternoon. They raised rates by 15% as the Argentine Peso remains in free-fall and the country seeks a bailout from the IMF.

  • According to City AM, EU leaders are preparing to broaden Michel Barnier’s mandate in order to force through a Brexit deal at the 11th Hour. The EU’s member states would be prepared to effectively ‘fudge’ an agreement on the contentious Irish Border issue in order to seal the withdrawal agreement with the UK by the original October deadline.
  • Canadian Foreign Affairs Minister, Chrystia Freeland, has said she is optimistic a deal could be done by the end of the week on the renegotiation of NAFTA. She added there had been a lot of Good Will from the US trade representatives.
  • US President Donald Trump has threatened to withdraw the US from the World Trade Organisation (WTO) if ‘they don’t shape up’. Trump continues to believe the US is being treated unfairly in global trade and points the finger at the WTO for allowing it to happen.
  • China Manufacturing PMI 51.3 (51.0 Exp)
  • China Non-Manufacturing PMI 54.2 (53.8 Exp)
  • UK Nationwide HPI m/m -0.5% (0.1% Exp)
  • German Retail Sales m/m -0.4% (-0.1% Exp)
  • European data headlines this morning with Eurozone Inflation and Unemployment the key prints to look out for, both due at 10am.
  • Relatively quiet this afternoon with a few lower impact US and Canadian prints.


Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1143 -0.08
GBP/USD 1.3024 +0.13
EUR/USD 1.1686 +0.14
AUD/USD 0.7254 -0.13


Time (GMT) Region Data Release Forecast Previous
10.00 EUR CPI Flash Estimate y/y 2.1% 2.1%
10.00 EUR Italian Prelim CPI m/m 0.2% 0.3%
10.00 EUR Unemployment Rate 8.2% 8.3%
13.30 CAD RMPI m/m 0.0% 0.5%
14.45 USD Chicago PMI 63.0 65.5
15.00 USD Revised UoM Consumer Sentiment 95.5 95.3