Newsletter – 3rd August 2017

Morning Bulletin


  • UK Construction PMI data disappointed yesterday morning with the reading of 51.9 falling well short of the expected 54.3. That represented an 11-month low and reflected a lower volume of commercial building and softer expansion of housing activity.
  • Sterling was briefly sold off in FX space but made back those losses and then some over the course of the day. The one currency it couldn’t reverse losses against was the Euro. Just ahead of the print GBP/EUR was trading at 1.1188 but it closed the day down around 1.1157.
  • Credit Ratings Agency Moody’s raised its outlook on the UK’s banking system to stable from negative yesterday morning.
  • As Expected the Indian Central Bank lowered their key interest rate to 6.0% from 6.25%.
  • The data calendar was incredibly sparse yesterday, and our only other key figure came at 1.15pm. The US ADP Non-Farm Employment Change print was slightly worse than expected, with 178,000 more people employed in the US during the month of July against an expected rise of 187,000.
  • Even before this dissapointing print the US Dollar was on the back-foot once again in FX space.
  • US President Trump has signed a bill that will impose new sanctions on Russia, however he has called the bill ‘significantly flawed’ and blamed Congress for forcing his hand.
  • Speaking shortly after the bill was signed, EU President Juncker stated the EU would counter any measures that may harm European companies linked to oil and gas projects in Russia.



  • Australian Trade Balance 0.86Bn (1.78Bn Exp)
  • Aussie Dollar under real pressure in FX space following this disappointing print.
  • China Caixin Services PMI 51.5 (51.9 Exp)
  • Raft of US Federal Reserve members speaking last night:
    • Williams believes there should be one more rate hike this year, and then potentially another three next year.
    • In Stark contrast Bullard is totally opposed to any further hikes, as he believes they could hinder domestic inflation reaching the Fed’s 2% target.
  • Today is of course ‘Super Thursday’ and will be dominated by the much anticipated Bank of England Monetary policy meeting, rate decision and bank rate votes.
  • Alongside the rate decision we also have the BOE’s quarterly inflation report and we will hear from BOE Governor Mark Carney at a press conference.
  • There are also key US data releases this afternoon in the form of Unemployment Claims and ISM Non-Manufacturing PMI.


Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1172 +0.16
GBP/USD 1.3233 +0.08
EUR/USD 1.1845 -0.09
AUD/USD 0.7926 -0.50


Time (GMT) Region Data Release Forecast Previous
09.00 EUR Eurozone Final Services PMI 55.4 55.4
09.30 GBP UK Services PMI 53.6 53.4
12.00 GBP BOE Inflation Report
12.00 GBP BOE Bank Rate Votes 2-0-6 3-0-5
12.00 GBP BOE Official Bank Rate 0.25% 0.25%
12.00 GBP BOE Monetary Policy Summary
12.30 GBP BOE Governor Carney Speaks
13.30 USD Unemployment Claims 242K 244K
15.00 USD ISM Non-Manufacturing PMI 56.9 57.4
15.00 USD Factory Orders m/m 2.9% -0.8%