United States Dollar:
It was a relatively quiet end to last week on the FX markets, with little top-tier data to move the markets. The one release of note from the UK was a worse than expected trade balance release for June, which showed a deficit of £9.4bn. At around £500mln worse than expected, this added further downward pressure on cable which dipped below 1.68 on Friday afternoon, and currently trades at 1.6787. It’s a quiet start to the week with little data of note out today. Wednesday sees UK unemployment data at 9:30am and an hour later the quarterly BoE Inflation Report. The report is always closely followed, and although little change to growth and inflation forecasts is expected, it could be pound negative if the recent slip in wage growth is highlighted as a drag on the economy, as well as a reason for further delay in interest rate rises. Wednesday afternoon sees US Retail Sales with another modest increase expected.
Euro:
The euro benefitted from an apparent de-escalation in tensions on Friday between Russia and the Ukraine. EUR/USD, which had started the day at around 1.3350, traded as high as 1.3430 by the afternoon as reports came through that Russian warplanes were ending their military drills in the region. GBP/EUR followed cable’s fall and found support at 1.25. It currently trades at 1.2537 with EUR/USD at 1.3390. Tomorrow sees the monthly ZEW Economic Sentiment Survey from Germany. The steady fall we have seen throughout 2014 is expected to continue, with a reading of 18.2 expected. Thursday sees preliminary GDP releases from Germany, France and the eurozone as a whole as well as the final CPI reading for July.
Aussie and Kiwi Dollars:
The Aussie remains lower after last week’s poor jobs data and neutrally-toned Monetary Policy Statement. AUD/USD currently trades at .9272, with GBP/AUD at 1.8106. NZD/USD trades at .8466 and GBP/NZD is at 1.9832. There is little high-impact data from Australia and New Zealand this week, with Wednesday night’s quarterly Retail Sales figure from NZ the only release of note.
Date Releases for the next 24 hours:
AUD: NAB Business Confidence
EUR: No data
GBP: No data
NZD: No data
USD: No data
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