United States Dollar:
In the absence of any top-tier data yesterday, cable traded between 1.6775 and 1.6795 throughout the London session. It appears the FX markets will be relatively calm through to Wednesday morning, when, at 9:30am, we have UK unemployment data, which will be followed an hour later by the quarterly Bank of England Inflation Report. The report will contain the Bank’s latest economic projections, and could give clues on when the UK will raise interest rates, after more than five years on hold at 0.5%. With recent poor manufacturing data and wage growth slipping, we could see the pound sold off if the report’s content and Governor Mark Carney’s accompanying press conference cut a dovish tone. GBP/USD currently trades at 1.6777.
Euro:
EUR/USD mirrored cable’s narrow range yesterday, trading between 1.3381 and 1.3396 throughout the London session. This morning we have the latest German ZEW Economic Sentiment survey, which is expected to fall to 18.2 from last month’s reading of 27.1. The survey has fallen every month since the start of the year, partly due to the sluggish performance of the eurozone and the recent turmoil in the Ukraine. With German data going south recently, Thursday’s preliminary Q2 GDP figure from Germany could be sobering reading for holders of the shared currency. EUR/USD has dropped a little overnight, and is at 1.3370 at present. GBP/EUR is at 1.2545.
Aussie and Kiwi Dollars:
Overnight saw the latest NAB Business Confidence survey rise to 11 from last month’s reading of 8. The report cited improving business conditions, and a surge in retailer confidence, as the main reasons for the improved sentiment. AUD/USD rose 20 pips on the release to hit .9276, though it has fallen away slightly to currently trade at .9257. NZD/USD currently trades at .8422, with Wednesday night’s Retail Sales figure the next risk event for holders of the Kiwi. GBP/AUD sits at 1.8117 and GBP/NZD is at 1.9917.
Date Releases for the next 24 hours:
AUD: Westpac Consumer Sentiment; Wage Price Index q/q
EUR: German ZEW Economic Sentiment
GBP: No data
NZD: No data
USD: No data
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