Previous Day's Market Highlights
Overall, the calendar was relatively quiet yesterday, with the dollar under some selling pressure as month-end neared. Sterling-euro continued to trade in the 1.12-1.13 band, while sterling-dollar held in the 1.31-1.32 range, and euro-dollar made gains towards 1.17. For the UK, the main focus of the week is Thursday’s Bank of England meeting and possible interest rate hike.
Early Tuesday UK time, the Bank of Japan kept interest rates on hold. It announced it would allow more flexibility over its bond yield target and introduced forward guidance, saying that interest rates would remain “extremely low…for an extended period of time”. The yen saw volatility around the announcement and ultimately ended up softer.
|Currency Pairing||08:00 Today||Vs 08:00 Yesterday||Four-Week High||Four-Week Low||% Change|
Today's Market Highlights
It’s a busy morning for the euro, which will eye the release of Q2 GDP, July inflation, and the Unemployment Rate (10:00 BST). A pick-up in core inflation and slower GDP growth year-on-year could offset each other, while any surprises to the downside could weigh on the euro. Overall, rates could remain around familiar levels.
In the US, Personal Consumption Expenditures (13:30) are forecast to remain unchanged, with core PCE at the Fed’s 2% target level. Overall the figures may be relatively dollar supportive. An acceleration in Canadian GDP (13:30) in May could strengthen the loonie this afternoon. Softer Employment Change could weaken the New Zealand dollar in overnight trading.
Tomorrow, the Fed is expected to keep interest rates on hold, which means investors will watch the statement closely for any additional clues on the timing and number of additional rate hikes this year—two more are currently expected, in September and December. On Thursday, the Bank of England is widely expected to raise interest rates by 25 basis points. Should it instead hold steady, this would come as a notable surprise to the downside for the pound.
Today's Economic Calendar
|10:00am||EUR||Preliminary Q2 Eurozone GDP QoQ (Q2)||0.4%||0.4%|
|10:00am||EUR||Preliminary Q2 Eurozone GDP YoY (Q2)||2.2%||2.5%|
|10:00am||EUR||Unemployment Rate (Jun)||8.3%||8.4%|
|10:00am||EUR||Preliminary CPI YoY (Jul)||2.0%||2.0%|
|10:00am||EUR||Preliminary Core CPI YoY (Jul)||1.0%||0.9%|
|1:30pm||USD||Core Personal Consumption Expenditure - Price YoY (Jun)||2.0%||2.0%|
|1:30pm||USD||Personal Consumption Expenditure - Price YoY (Jun)||2.3%||2.3%|
|1:30pm||USD||Personal Spending (Jun)||0.4%||0.2%|
|1:30pm||USD||Personal Income MoM (Jun)||0.4%||0.4%|
|1:30pm||CAD||GDP MoM (May)||0.3%||0.1%|
|11:45pm||NZD||Employment Change (Q2)||0.4%||0.6%|
|11:45pm||NZD||Unemployment Rate (Q2)||4.4%||4.4%|