GBP Hits New Recent Highs on MPC Comments

Following Thursday's hawkish BoE meeting, additional hawkish comments from MPC Member Vlieghe on Friday saw sterling rally to new recent highs. Vlieghe said a rate hike may come in the following months and that more than one hike may be appropriate.

Previous Day's Market Highlights

Following Thursday's hawkish BoE meeting, additional hawkish comments from MPC Member Vlieghe on Friday saw sterling rally to new recent highs. Vlieghe said a rate hike may come in the following months and that more than one hike may be appropriate.

Sterling-dollar broke 1.3600, its highest levels since the referendum results on 24 June 2016. Sterling-euro regained 1.1300, briefly eyeing 1.1400, which it last hit on 17 July 2017.
 
US Retail Sales, Industrial Production, and Capacity Utilization disappointed expectations. The dollar fell against the euro as the rate pushed higher towards 1.2000. The pound gained over 3% against the dollar following Thursday’s hawkish BoE.
 
The pound had also received support earlier in the week as the House of Commons passed the EU Withdrawal Bill following a second reading and as inflation surprised to the upside, rising back to May’s high of 2.9%. 

Currency Pairing 08:00 Today Vs 08:00 Yesterday Four-Week High Four-Week Low % Change
GBP / EUR 1.1374 1.1397 1.0745 5.72%
GBP / USD 1.3590 1.3617 1.2777 6.17%
EUR / USD 1.1948 1.2093 1.1731 2.99%
GBP/AUD 1.6946 1.7003 1.6165 4.93%
GBP / NZD 1.8595 1.8742 1.7522 6.29%
GBP / CAD 1.6546 1.6581 1.5837 4.49%

Today's Market Highlights

Releases today include Final Eurozone August CPI (10:00 BST). Any upwards revisions could support the euro as traders look for signals that inflation is on track for the ECB to begin normalising monetary policy.
 
BoE Governor Carney speaks this afternoon (16:00 BST) at the IMF’s Central Banking Lecture. Any comments reiterating last week’s more hawkish views from the MPC could further support the pound.
 
The Fed is expected to keep interest rates on hold when it meets this week. Traders will look for guidance on the winding down of the Fed’s balance sheet and its current thoughts on inflation.  

Today's Economic Calendar

Time Currency Release Consensus Previous
10:00 EUR Final Eurozone CPI YoY (Aug) 1.5% 1.5%
10:00 EUR Final Core Eurozone CPI YoY (Aug) 1.2% 1.3%
13:30 CAD Foreign Securities Purchases $4.46B $-0.92B
15:00 USD NAHB Housing Market Index (Sep) 67 68
15:30 EUR ECB's Lautenschlager Speaks
16:00 GBP BoE Governor Carney Speaks
19:00 CAD BoC Governing Council Member Lane Speaks
02:30 AUD RBA Meeting's Minutes