Newsletter – 3rd October 2017

Morning Bulletin

Yesterday

  • Very poor day for Sterling yesterday. The Pound had opened the day on the back-foot following a YouGov/times poll over the weekend which suggested a majority of Tory Lawmakers want PM Theresa May out before the next election.
  • This was then compounded by a weaker than expected UK Manufacturing PMI Print, with the actual figure of 55.9 falling just short of the expected 56.3. The Pound remained on the back-foot for the rest of the day, closing the day down over 0.9% against the Dollar at 1.3267, whilst it was down some 0.4% against the Euro at 1.1295.
  • There were a raft of Eurozone figures released over the course of yesterday morning, none of which would be deemed high impact, some of the selected prints are below:
    • Eurozone Unemployment Rate 9.1% (9.0% Exp)
    • Spanish Manufacturing PMI 54.3 (53.2 Exp)
    • Eurozone Final Manufacturing PMI 58.1 (58.2 Exp)
  • The days Manufacturing numbers were completed by three releases out of the United States:
    • ISM Manufacturing PMI 60.8 (57.9 Exp)
    • Final Manufacturing PMI 53.1 (53.0 Exp)
    • ISM Manufacturing Prices 71.5 (64.5 Exp)
  • The ISM print was the most important of the above three and it comfortably beat expectations and incredibly represented a 13-year high at 60.8. Whilst the report suggested US Manufacturers were on a firm footing already this year, this massive beat on expectations could be in part due to a bounce-back in business from Hurricane Harvey.
Overnight

  • The Reserve Bank of Australia kept rates on hold at 1.50%as expected, with no real changes or amendments to their previous policy statement.
  • Australia Building Approvals m/m 0.4% (1.1% Exp)
  • Spanish Unemployment Change 27.9K (21.3K Exp)
  • Speaking yesterday evening US Fed Member Kaplan said he had an open mind going into the December meeting and that he didn’t necessarily need to see signs of higher inflation ahead of the meeting, just a belief that it will converge toward the Fed’s target over the next 2-3 years.
Today
  • Quiet day where data is concerned. Just the one key print this morning with UK Construction PMI due at 9.30am.
  • Worth noting that today is a German Bank Holiday (Unity Day) and a Chinese Bank Holiday.

 

Currency Pair Interbank Rate % Change on Day
GBP/EUR 1.1308 -0.04
GBP/USD 1.3275 +0.04
EUR/USD 1.1737 +0.04
AUD/USD 0.7808 -0.20

 

Time (GMT) Region Data Release Forecast Previous
09.30 GBP Construction PMI 51.2 51.1
09.30 GBP BOE ‘FPC’ Meeting Minutes
10.00 EUR Eurozone PPI m/m 0.1% 0.0%
13.30 USD Fed Member Powell Speaks
TBC NZD GDT (Dairy) Price Index 0.9%
17.30 CAD BOC Member Leduc Speaks