Australian and New Zealand Dollars feel the weight of Chinese data [Video]

Today's Highlights

  • Australian and New Zealand Dollars feel the weight of Chinese data

  • Brexit timetable discussed

  • UK inflation below forecast

  • Euro strengthens on strong German data


Current Market Overview

Australian and New Zealand Dollars feel the weight of Chinese data

Overnight in Australia, data released from National Australia Bank (NAB) showed that business conditions hit their highest level since their records began in 1997. The markets' reaction was muted, however, as Chinese retail sales figures also released overnight came in below expectations – October sales rose 10% versus 10.5% expected. Industrial production also rose 6.2% year on year, below the expected 6.6% year on year. This weighed on the Australian and New Zealand Dollars, which helped push GBPAUD through 1.72 and GBPNZD through 1.91.

Brexit timetable discussed

David Davis announced in the House of Commons that the UK parliament will get to vote on the final Brexit deal – the timetable being that the "principal policy aim" will be read by October 2018, then debates in Parliament; and the final vote before B-day, 29th March 2019. This doesn't, however, give Parliament a vote in the event of a no-deal, which looks increasingly likely...

UK inflation below forecast

We've just had UK inflation data released and it's come in at 3.0% for October, matching September's headline figure, which was a five year high. There has been a rise in food prices across all main classes of product, including dairy, which has seen recent wholesale shortages. This was below the 3.1% figure forecast, so the Pound sold off a touch on the announcement. We'll be hearing from Bank of England (BoE) Governor Mark Carney shortly.

Euro strengthens on strong German data

The Euro has gained over the last trading session, up from 1.16 to 1.17 on EURUSD and GBPEUR, breaking down through 1.1200, with this morning's German data helping to boost the single currency. German Gross Domestic Product (GDP) data (preliminary reading) beat expectations for the third quarter, growing 0.8% versus the 0.6% expectation.

What to look out for today

The main European data of note for the rest of the day will be the German ZEW Survey; in the US, Federal Reserve Chair Janet Yellen speaking, the US Producer Price Index and then overnight, the Westpac Consumer Confidence report for Australia.


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