Forex Today: Pound weaker ahead of Brexit Summit, UK CPI

Dhwani Mehta FXStreet

The US dollar and the Kiwi replicated the moves seen in Asia a day before, as risk-on sentiment remained the key underlying theme amid upbeat US earnings and firmer equities.

In absence of fresh fundamental drivers this session, the fx today was driven by the USD price-action, with the pound taking a back seat ahead of the key Brexit Summit and UK CPI report. The USD/JPY pair extended gains but remained capped by 112.50 level while the Aussie faced rejection once again near 0.7150. The Kiwi was the top performer while both the EUR and CAD emerged the laggards.

Among the commodities space, both crude benchmarks traded flat while gold prices on Comex dropped below USD 1225 amid a better risk environment.

Main topics in Asia

RBA Debelle: wages may not increase until unemployment falls further

US Trump: Saudi prince denies knowledge of journalist slaying - Reuters

UK trade minister to deny that the UK will lower food standards post-Brexit - Reuters

Trump: A good relationship with Russia is better than bad one – Fox News

Asian stocks see gains as investors shrug off market fears, Nikkei 225 extends bounce

Key Focus ahead

We have busy session ahead, with the two-day crucial European Union Summit on the Brexit deal likely to kick-off later today. The market sentiment will be driven by the Brexit-related developments while the UK inflation figures could also offer some trading impetus to the GBP markets. The UK consumer prices are likely to accelerate to 2.8 percent y/y in September while core figures are seen softer at 1.8 percent.

Also, in focus remains the Eurozone final CPI data due on the cards at 0900 GMT alongside the release of the construction output. The US docket also remains quite eventful, with the US housing starts and building permits data slated for release at 1230 GMT ahead of the speeches by the ECB Vice-President Weidmann and FOMC member Brainard. The main highlight in the NA session remains the FOMC minutes due at 1800 GMT.

EUR/USD: Bears eyeing 1.1535 ahead of Eurozone CPI, Fed minutes

The bid tone around the US dollar keeps growing bigger heading into the early European trading, keeping the EUR/USD pair near the lower bound of today´s trading range below the 1.16 handle, as the immediate focus now remains on the Eurozone final CPI figures due at 0900 GMT.

GBP/USD: Buyers struggling to keep the wheels upright ahead of major EU summit, UK CPI

The overall mood in markets remains taut in the run-up to Wednesday's EU leadership summit, where Brexit will be the top billing for the day. Alongside the headline-driving EU summit that kicks off today, Britain sees September's CPI in the barrel for 08:30 GMT.

UK inflation Preview: Real wages set to increase further as inflation is seen decelerating

The UK headline inflation is expected to have accelerated to 2.5% y/y in September, from 2.4% y/y in August while core inflation stripping the consumer basket off food and energy prices is seen decelerating to 1.8% y/y …

FOMC minutes to show Fed remains constructive on the economic outlook - Barclays

The Barclays Research Team offers key highlights on what to expect from Wednesday´s FOMC minutes of the September monetary policy meeting due to be released at 1800 GMT.

GMT	Event	Actual	Consensus	Previous
Tuesday, Oct 16
20:00	USD Net Long-Term TIC Flows	$131.8B	$47.7B	$66.7B Revised from $74.8B
20:00	USD Total Net TIC Flows	$108.2B	$19.9B	$52.2B
20:15	USD FOMC Member Daly speech
20:30	USD API Weekly Crude Oil Stock	-2.10M		9.75M
21:20	AUD RBA Assist Gov Debelle Speech
23:30	AUD Westpac Leading Index (MoM)	-0.1%		0.1%
Wednesday, Oct 17
24h	CNY Chung Yeung Festival
24h	GBP EU Brexit Summit
24h	HKD Chung Yeung Festival
03:00	KRW Money Supply Growth	6.2%		6.2%
07:00	EUR HICP (YoY)			2.3%
07:00	EUR HICP (MoM)			0%
07:00	EUR EU Norm Inflation (YoY)		2.8%	2.9%
07:00	EUR EU Norm Inflation (MoM)		0.1%	0.2%
07:30	EUR ECB's Praet Speech
08:00	PLN Producer Price Index (YoY)		3%	3%
08:30	GBP Retail Price Index (MoM)		0.2%	0.9%
08:30	GBP Retail Price Index (YoY)		3.2%	3.5%
08:30	GBP DCLG House Price Index (YoY)		3.5%	3.1%
08:30	GBP Producer Price Index - Output (MoM) n.s.a		0.2%	0.2%
08:30	GBP Producer Price Index - Output (YoY) n.s.a		2.9%	2.9%
08:30	GBP PPI Core Output (MoM) n.s.a		0.1%	0.1%
08:30	GBP Producer Price Index - Input (YoY) n.s.a		5.7%	8.7%
08:30	GBP PPI Core Output (YoY) n.s.a		2.1%	2.1%
08:30	GBP Producer Price Index - Input (MoM) n.s.a		0.2%	0.5%
08:30	GBP FPC Meeting Minutes
08:30	GBP Core Consumer Price Index (YoY)		1.8%	2.1%
08:30	GBP Consumer Price Index (YoY)		2.8%	2.7%
08:30	GBP Consumer Price Index (MoM)		0.5%	0.7%
09:00	EUR Consumer Price Index (MoM)		0.5%	0.2%
09:00	EUR Consumer Price Index - Core (YoY)		1.0%	0.9%
09:00	EUR Consumer Price Index - Core (MoM)		0.2%	0.2%
09:00	EUR Consumer Price Index (YoY)		2.1%	2.1%
09:00	EUR Construction Output w.d.a (YoY)		1.7%	2.6%
09:00	EUR Construction Output s.a (MoM)		-0.1%	0.3%
n/a	EUR 30-y Bond Auction			1.1%
11:00	USD MBA Mortgage Applications			-1.7%
11:00	ZAR Retail Sales (YoY)		1.3%	1.3%
12:30	USD Housing Starts Change			9.2%
12:30	USD Building Permits Change		3.4%	-5.7%
12:30	USD Housing Starts (MoM)		1.237M	1.282M
12:30	USD Building Permits (MoM)		1.280M	1.249M Revised from 1.229M
12:30	CAD Manufacturing Shipments (MoM)		-0.1%	0.9%
13:00	RUB Unemployment Rate		4.7%	4.6%
n/a	RUB Producer Price Index (YoY)			15.3%
n/a	RUB Producer Price Index (MoM)			0.2%
14:30	USD EIA Crude Oil Stocks change		-0.281M	5.987M
15:00	COP Industrial ouput (YoY)			3.5%
16:10	USD FOMC Member Brainard Speech
16:30	EUR German Buba President Weidmann speech
17:00	GBP MPC Member Broadbent Speech
18:00	USD FOMC Minutes
19:00	ARS Consumer Price Index (MoM)			4.1%
22:00	COP Retail Sales (YoY)
23:50	JPY Exports (YoY)		5.6%	6.6%
23:50	JPY Adjusted Merchandise Trade Balance		¥-287.4B	¥-190.4B
23:50	JPY Imports (YoY)		14.9%	15.4%
23:50	JPY Merchandise Trade Balance Total		¥-469.0B	¥-444.6B
23:50	JPY Foreign bond investment			¥-200.5B
23:50	JPY Foreign investment in Japan stocks			¥1,578.4B
Thursday, Oct 18
24h	GBP EU Brexit Summit
24h	EUR EcoFin Meeting
n/a	JPY Bank of Japan Governor Kuroda Speech
00:30	AUD National Australia Bank's Business Confidence (QoQ)			7
00:30	AUD Employment Change s.a.		15K	44K
00:30	AUD Fulltime employment			33.7K
00:30	AUD Part-time employment			10.2K
00:30	AUD Unemployment Rate s.a.		5.3%	5.3%
00:30	AUD Participation Rate		65.6%	65.7%
01:00	KRW BoK Interest Rate Decision		1.5%	1.5%
n/a	CNY M2 Money Supply (YoY)		8.3%	8.2%
n/a	CNY New Loans		1,347B	1,280B
n/a	CNY FDI - Foreign Direct Investment (YTD) (YoY)			2.3%
04:30	EUR Unemployment Rate s.a (3M)			3.9%
06:00	EUR Wholesale Price Index (MoM)		0.4%	0.3%
06:00	EUR Wholesale Price Index (YoY)			3.8%
06:00	CHF Trade Balance		2,482M	2,134M
06:00	CHF Exports (MoM)			17,380M
06:00	CHF Imports (MoM)			15,246M
08:30	GBP Retail Sales ex-Fuel (YoY)		3.6%	3.5%
08:30	GBP Retail Sales ex-Fuel (MoM)		-0.2%	0.3%
08:30	GBP Retail Sales (MoM)		-0.8%	0.3%
08:30	GBP Retail Sales (YoY)		3.3%	3.3%
08:30	SEK Unemployment Rate			6.1%
09:00	EUR 10-y Bond Auction			0.86%
n/a	EUR 10-y Obligaciones Auction			1.54%
10:30	EUR Current Account Balance			€-1.641B
12:30	USD Initial Jobless Claims		206K	214K
12:30	USD Continuing Jobless Claims		1.651M	1.660M
12:30	USD Employment cost index			0.6%
12:30	USD Philadelphia Fed Manufacturing Survey		20.0	22.9
12:30	CAD ADP Employment Change			13.6K
13:00	USD Fed's Bullard speech
13:00	RUB Central Bank Reserves $			$459.2B
14:30	USD EIA Natural Gas Storage change		71B	90B
15:00	COP Trade Balance			$-558M
16:15	USD Fed's Quarles speech
21:45	NZD Visitor Arrivals (YoY)			5.4%
23:30	JPY National CPI Ex-Fresh Food (YoY)		0.9%	0.9%
23:30	JPY National Consumer Price Index (YoY)			1.3%
23:30	JPY National CPI Ex Food, Energy (YoY)		0.4%	0.4%
Friday, Oct 19
02:00	CNY Retail Sales (YoY)		9%	9%
02:00	CNY Industrial Production (YoY)		6.0%	6.1%
02:00	CNY NBS Press Conference
02:00	CNY Fixed Asset Investment (YTD) (YoY)		5.3%	5.3%
02:00	CNY Gross Domestic Product (YoY)		6.6%	6.7%
02:00	CNY Gross Domestic Product (QoQ)		1.6%	1.8%
02:00	NZD Credit Card Spending (YoY)			7.7%
04:30	EUR Consumer Spending Volume			2.6%
04:30	EUR Consumer Confidence Adj			19
06:35	JPY Bank of Japan Governor Kuroda Speech
07:00	HUF Gross Wages (YoY)			12.8%
08:00	PLN Retail Sales (YoY)			9%
08:00	EUR Current Account s.a			€31.9B
08:00	EUR Current Account n.s.a		€21.4B	€21.3B
08:30	GBP Public Sector Net Borrowing		£4.600B	£5.889B
08:30	HKD Unemployment rate			2.8%
08:30	EUR Unemployment Rate		5.4%	5.4%
10:00	GBP CBI Distributive Trades Survey - Realized (MoM)			23%
11:30	INR FX Reserves, USD			$399.61B
12:30	CAD Retail Sales (MoM)		0.4%	0.3%
12:30	CAD Retail Sales ex Autos (MoM)		-0.2%	0.9%
12:30	CAD Consumer Price Index (MoM)		-0.1%	-0.1%
12:30	CAD Consumer Price Index (YoY)		2.9%	2.8%
12:30	CAD Consumer Price Index - Core (MoM)			0.2%
12:30	CAD Bank of Canada Consumer Price Index Core (MoM)		0.2%	0.1%
12:30	CAD Bank of Canada Consumer Price Index Core (YoY)		1.8%	1.7%
13:00	USD FOMC Member Kaplan Speech
14:00	USD Existing Home Sales (MoM)		5.35M	5.34M
14:00	USD Existing Home Sales Change (MoM)		1.8%	0.0%
14:00	EUR Consumer Confidence Index			0
15:30	GBP BOE's Governor Carney speech
16:00	USD FOMC Member Bostic speech
17:00	USD Baker Hughes US Oil Rig Count			869
19:30	USD CFTC Gold NC net positions			$-38.2K
19:30	USD CFTC Oil NC net positions			528.1K
19:30	USD CFTC USD NC net positions			$255.8K
19:30	GBP CFTC GBP NC net positions			£-60.5K
19:30	JPY CFTC JPY NC net positions			¥-115.2K
19:30	EUR CFTC EUR NC net positions			€-16.1K
19:30	AUD CFTC AUD NC net positions			$-73.3K
Saturday, Oct 20
01:30	CNY House Price Index			7%

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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