Eurozone CPI, US GDP Awaited

Key data today include Eurozone Feb CPI and US Q4 GDP. Any Brexit headlines will drive the pound.

Previous Day's Market Highlights

The dollar gained yesterday around testimony from Fed Chair Powell, who reiterated support for raising interest rates gradually and struck an upbeat tone on the economy. Sterling-dollar fell below 1.39 after breaking below 1.40 on Monday, and euro-dollar fell back below 1.23. Against the softer euro, the pound continued to trade above 1.13.
 
German inflation slowed to 1.2%, according to the harmonised index, which could contribute to a lower Eurozone print. US economic data were mixed, including a larger than forecast decline in Durable Goods Orders and a pick-up in consumer confidence.
 
Sterling-kiwi again tested 1.92 and sterling-Aussie regained 1.78, but sterling-loonie held below 1.78.

Currency Pairing 08:00 Today Vs 08:00 Yesterday Four-Week High Four-Week Low % Change
GBP/EUR 1.1367 1.1474 1.1210 2.30%
GBP/USD 1.3896 1.4291 1.3763 3.69%
EUR/USD 1.2224 1.2556 1.2206 2.79%
GBP/AUD 1.7807 1.7999 1.7436 3.13%
GBP/NZD 1.9207 1.9456 1.8942 2.64%
GBP/CAD 1.7744 1.7783 1.7343 2.60%

Today's Market Highlights

The euro is in focus this morning with the release of preliminary February CPI data (13:00 GMT). The headline figure is forecast to slow to 1.2% from 1.3%, while core inflation is expected to pick up to 1.1%. There are no major UK economic indicators expected today, but the pound remains vulnerable to Brexit headlines, and the EU is expected to release its draft Brexit withdrawal treaty today.
 
In the afternoon, the US releases the next estimate of Q4 GDP, with a downwards revision to 2.5% projected, quarterly Personal Consumption Expenditures, the Chicago Purchasing Managers’ Index, and Pending Home Sales (13:30, 14:45, 15:00 GMT). Fed Chair Powellwill continue his semi-annual monetary policy testimony today.
 
Canadian dollar traders will keep an eye on weekly EIA Crude Oil Inventories for any surprises.  

Today's Economic Calendar

Time Currency Release Consensus Previous
10:00 EUR Consumer Price Index YoY (Feb) 1.2% 1.3%
10:00 EUR Core CPI YoY (Feb) 1.1% 1.0%
13:30 USD Preliminary GDP Q4 2.5% 2.6%
13:30 USD Core Personal Consumption Expenditures QoQ (Q4) 1.9% 1.3%
14:45 USD Chicago Purchasing Managers' Index (Feb) 64.2 65.7
15:00 USD Pending Home Sales YoY (Jan) -1.8%
15:30 USD EIA Crude Oil Inventories (23 Feb) 2.077M -1.616M
01:45 CNY Caixin Manufacturing PMI (Feb) 51.3 51.5
01:45 CNY Caixin Manufacturing PMI (Feb) 51.3 51.5

Caxton