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All eyes on US Inflation figure today

11th August 2017 Market Update

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🇬🇧 GBP – Yesterday we saw UK manufacturing flat lining, but industrial production figures were more positive than expected. Trade figures were hit as the trade balance fell further into the red. The mixed data did little to move the Pound.

There was also a fair amount of commentary on the financial market risks as it’s been 10 years since the crash and the general consensus is that there is still too much risk in the financial system, which is keeping the Pound pressured.

🇪🇺 EUR – No economic releases of note yesterday from the Eurozone, however this week saw talks about how much money the UK will need to pay when leaving the EU – this is likely a debate that will intrigue the public for a while and keep the negotiators on both sides in heated discussions.

German inflation figures were released early this morning and made no impact as all figures were in line with expectations.

🇺🇸 USD – In the US, initial jobless claims increased slightly yesterday, though the continuing jobless figure fell. Later in the day, New York Fed President William Dudley reinforced the Fed’s gradual policy-tightening plan when he said that he expects inflation to rise over the next months. This has helped the dollar find some support overnight.

Today, all eyes will be on the inflation figure. Markets will be looking for an increase, which will lend support to Fed comments of late and pave the way for the next interest rate increase in the US, supporting the dollar.

 

 

Key Announcements

🇺🇸 13.30pm – CPI and Core CPI both expected at 0.2%

 

Our View: Very little data leaves sterling on the backfoot, however a key release from the US could change the market in a big way.

 

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Darren Kilner

Darren Kilner

Darren is Head of Dealing at FairFX. Darren lives and breaths FX, his Mastermind topics are G8 currencies and economic forecasts.

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