10th April 2017 Market Update
Get a snapshot of the day’s most important market events and currency movements sent straight to your inbox every morning. Sign up to our Daily Market Report.
🇬🇧 GBP – A fairly relaxed week on the data front with manufacturing and construction figures just missing expectations on Monday and Tuesday, though the services figure showed a marked improvement and bolstered the pound on Wednesday. The end of the week saw manufacturing production fall into negative territory and BoE Governor, Mark Carney set a 14th July deadline to see plans, saying financial firms must prepare for ‘all eventualities’, as he calls on politicians not to cut City adrift from Europe.
This week’s data starts off tomorrow with inflation in focus, whilst the YOY figure is expected to remain at 2.3% for March, the MOM is expected to fall to 0.3% from 0.7%. This could further hold back any potential talk of an interest rate hike from the Bank of England and pressure the pound.
Jobs data will take over on Wednesday, ahead of the Bank Holiday weekend, though no real change is expected.
🇪🇺 EUR – Eurozone unemployment remained at 9.5% at the beginning of the week, though services data fell short on Wednesday and Mario Draghi, the president of the ECB, delivered a speech on Thursday suggesting that he feels monetary policy is working in the Eurozone. Thus suggesting that rates may remain unchanged for longer than expected, despite recent rumours of an imminent rise.
Very little from the Eurozone this week, from Germany economic sentiment is set to pick up on Tuesday and inflation to remain at 1.6% on Thursday.
🇺🇸 USD – The US saw a positive manufacturing result at the beginning of last week, though services and non-manufacturing fell short by the middle of the week. In addition, the Fed minutes, focused on how and when the US will reduce their balance sheet which is currently at 4.5 trillion USD.
Statements hinted that the Fed may look to reduce this later this year, causing USD to weaken against a basket of currencies. The all important non-farm payrolls fell well short of expectations on Friday though the unemployment rate improved.
Janet Yellen will be speaking at the university of Michigan today, taking questions from the public, though unlikely to make have any impact on markets.
The rest of the week is thin in news with only Jolts job opening due on Tuesday and retails sales and inflation due on Friday, which could support the dollar whilst the UK is off.
09:30 – CPI (March).
09:30 – Unemployment rate, Claimant count, Average earnings.
9:00am – Wage inflation (Italy)
9:00am – Consumer Confidence (France & Italy)
15:00 – BoC Interest Rate Decision and press conference.
Our View: With the short week and lack of news early on we may see little movement till the back end of the week, when we may see squaring of positions on Thursday and given the US is open on Friday the dollar may find support toward the end of the week.
Find out more about our FX Dealing Service for personal & business international payments. We’re committed to giving all clients the best rate possible, along with flexible and personalised service. Save time and money by reducing risk through a simple and efficient service.