GBP Sees Morning Demand

Sterling has seen demand this morning. Central bank speakers and mid-level data are in focus today.

Previous Day's Market Highlights

Sterling held above 1.13 against the euro and 1.39 against the dollar. The pound continued to pick up heading into Monday’s session, rising towards 1.14 against the euro and above 1.40 against the dollar Monday morning. Euro-dollar regained 1.23 after inching lower Friday.
 
Data Friday confirmed that headline inflation in the Eurozone slowed to 1.3% in January and core inflation slowed to 1.0%. The Canadian dollar traded in both directions as CPI slowed less than forecast in January, to 1.7% from 1.9% when compared to a year earlier, but retail sales declined. The pound remains at around its highest levels against the loonie since last May.

Currency Pairing 08:00 Today Vs 08:00 Yesterday Four-Week High Four-Week Low % Change
GBP/EUR 1.1386 1.1474 1.1210 2.30%
GBP/USD 1.4027 1.4291 1.3763 3.69%
EUR/USD 1.2320 1.2556 1.2206 2.79%
GBP/AUD 1.7797 1.7999 1.7351 3.60%
GBP/NZD 1.9111 1.9456 1.8942 2.64%
GBP/CAD 1.7716 1.7783 1.7301 2.71%

Today's Market Highlights

Most of today’s economic data are low- to mid-level releases and may therefore have limited market impact. These include the US’s Chicago Fed National Activity Index (13:30 GMT), New Home Sales (15:00 GMT), and Dallas Fed Manufacturing Business Index (15:30 GMT), and New Zealand’s trade balance (21:45 GMT). The latter may see a softer kiwi in the overnight session.
 
It’s a busier day for central bank speakers. From the ECB, we have Cœuré giving the welcome address at the first meeting of the ECB’s Working Group on Euro Risk-Free Rates (10:00 GMT), followed by ECB President Draghi’s introductory statement at the European Parliament ECON Hearing. MPC Member Cunliffe will give a speech titled “What is Money?” after the European close (18:00 GMT). On the Fed side, Bullard and Quarles will both speak on the economy (13:00, 20:15 GMT).
 
Looking ahead, new Fed Chair Powell will give semi-annual testimony before the Senate this week. Brexit will remain in focus with additional government speeches expected, including one from PM May. Key for the euro will be preliminary February CPI figures and the Italian General Elections on Sunday.

Today's Economic Calendar

Time Currency Release Consensus Previous
10:00 EUR ECB's Coeure Speaks
13:00 USD Fed's Bullard Speaks
13:30 USD Chicago Fed National Activity Index (Jan) 0.15 0.27
14:00 EUR ECB's President Draghi Speaks
15:00 USD New Home Sales MoM (Jan) 0.642M 0.625M
15:30 USD Dalls Fed Manufacturing Business Index (Feb) 28.4 33.4
18:00 GBP MPC Member Cunliffe Speaks
20:15 USD Fed's Quarles Speaks
21:45 NZD Trade Balance MoM (Jan) $-2,710M $640M

Caxton