Newsletter – 31st October 2018

Morning Bulletin

Yesterday

  • Very quiet on the data front yesterday but such has been the pattern of late the Pound remained one of the weaker performers in FX space as Brexit concerns continue to weigh on Sterling.
  • Growth in the Eurozone dissapointed in the 3rd quarter of 2018. A GDP print of 0.4% had been expected, but the actual figure was just half that at 0.2%. Earlier in the morning Italian GDP for the 3rd quarter was reported as flat at 0.0%, with growth seemingly halting as the Italian row with the European Union took a hold.
  • Retail Sales in the UK dropped sharply in October according to the CBI. Their monthly survey gauge fell to +5 from +23 in September, the lowest since April. CBI economist Alpesh Paleja said the cooling of sales comes as the boost from the summer heatwave and the World Cup fades away.
  • In defiance of the EU, Italian Deputy PM Salvini said yesterday that Italy would press ahead with their budget as planned and that the weak 3rd quarter GDP print was another reason to implement their budget.
  • US Consumers continue to be incredibly upbeat about the economy with the CB Consumer Confidence print hitting an 18-year high of 137.9.
  • According to credit ratings agency S&P the UK and investors alike should brace for a recession as long as the one that followed the global financial crisis should the UK crash out of the EU with no deal.  
Overnight

  • There have been plenty of economic releases overnight and this morning.
  • The Bank of Japan left their benchmark interest rate on hold at -0.10% as expected, with the central bank also leaving their policy unchanged.
  • Australia CPI q/q 0.4% (0.5% Exp)
  • China Manufacturing PMI 50.2 (50.6 Exp)
  • China Non-Manufacturing PMI 53.9 (54.7 Exp)
  • German Retail Sales m/m 0.1% (0.5% Exp)
  • Spanish Flash GDP q/q 0.6% as expected
Today
  • Eurozone inflation will be in focus this morning, figure due at 10am.
  • This afternoon Canadian GDP is the key print due at 12.30pm.

 

Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1226 +0.21
GBP/USD 1.2738 +0.29
EUR/USD 1.1345 +0.02
AUD/USD 0.7085 -0.28

 

Time (GMT) Region Data Release Forecast Previous
10.00 EUR Eurozone CPI Flash Estimate y/y 2.2% 2.1%
10.00 EUR Eurozone Unemployment Rate 8.1% 8.1%
12.15 USD ADP Non-Farm Employment Change 188K 230K
12.30 CAD GDP m/m 0.0% 0.2%
13.45 USD Chicago PMI 60.1 60.4
17.15 CHF SNB Chairman Jordan Speaks
20.15 CAD BOC Gov Poloz Speaks