Newsletter – 31st October 2017

Morning Bulletin

Yesterday

  • Sterling proved to be one of the main beneficiaries on what was a very slow news day, making gains upwards of +0.40% against most of its major currency counterparts.
  • GBP/EUR closed the day up +0.42% at 1.1350, whilst GBP/USD closed the day at 1.3204 (+0.61%).
  • The only data of note during the morning session was UK Net Lending to Individuals, with the September print bang in-line with expectations at 5.5Bn.
  • German Inflation was flat during October with the m/m print of 0.0% falling shy of the 0.1% increase expected.
  • The Spanish Government has accused the entire former Catalan Government of rebellion, sedition and misuse of public funds, with the Spanish Attorney General calling for charges to be brought against Catalan leaders. Former Leader Puidgemonts has reportedly fleed to Brussels to seek political assylum.
  • The afternoon was equally flat, with just the two medium impact US data releases to digest:
    • Core PCE Price Index m/m 0.1% as expected
    • Personal Spending m/m 1.0% (0.8% Exp)
Overnight

  • The New York Times have reported President Trump is set to name Jerome Powell as the next Fed Chairman. Mr Powell would replace Janet Yellen who’s term expires in early 2018.
  • Sticking with President Trump, and his campaign chairman Paul Manafort has been indicted by the FBI overnight on charges that he funneled millions of Dollars through overseas shell companies, with funds stemming from lobbying work he had done in the Ukraine.
  • In a separate case, one of Trump’s early foreign policy advisers, George Papadopoulos, has pleaded guilty to lying to the FBI about his previous contact with a professor who had links to Kremlin officials.
  • New Zealand ANZ Business Confidence -10.1 (0.0 Previous). This was the first negative reading since September 2015 and would appear to reflect the current political uncertainty in the country.
  • China Manufacturing PMI 51.6 (52.2 Exp)
  • China Non-Manufacturing PMI 54.3 (55.4 Previous)
  • Bank of Japan hold policy rate at -0.10% as expected. The vote was 8-1 with new member Kataoka the only dissenter. There were no changes to the BOJ’s massive stimulus measures despite continued sluggish inflationary levels.
  • The UK’s GfK Consumer Confidence reading fell to -10.1%in October as expected.
Today
  • European data will be in the spotlight this morning with both Eurozone Inflation and GDP data due at 10am.
  • The afternoon session kicks off with Canadian GDP but otherwise could prove quiet.

 

Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1345 +0.09
GBP/USD 1.3210 +0.03
EUR/USD 1.1643 -0.06
AUD/USD 0.7677 -0.13

 

Time (GMT) Region Data Release Forecast Previous
10.00 EUR CPI Flash Estimate y/y 1.5% 1.5%
10.00 EUR Prelim Flash GDP q/q 0.5% 0.6%
12.30 CAD GDP m/m 0.1% 0.0%
12.30 CAD RMPI m/m 0.4% 1.0%
13.45 USD Chicago PMI 60.2 65.2
14.00 USD CB Consumer Confidence 121.1 119.8
19.30 CAD BOC Gov Poloz Speaks