Marketwatch EU & UK

Daily Insights
October 17, 2023

  • flag united kingdom 1f1ec 1f1e7After rallying yesterday, GBPUSD starts the day softer as data released this morning showed that UK wage growth slipped in the three months to August, boosting the odds of an interest rate pause from the BoE. Average earnings excluding bonuses rose 7.8% from a year earlier, down from an upwardly revised 7.9% in July, the fastest recorded since the series began in 2001. Growth in private sector pay also eased, suggesting that the string of 14 consecutive interest rate hikes from the MPC since the end of 2021 is having an impact. The print comes 24 hours before the important CPI inflation print for September and helped push cable down from 1.2220 to 1.2175 ahead of support at 1.2135. The pair is likely to trade with a slight downward bias ahead of tomorrow’s inflation report, with resistance not seen until 1.2230.

 

  • flag united states 1f1fa 1f1f8The US dollar remains steady with the dollar index trading at session lows, as treasury yields ticked a little higher. The small slip in the greenback also came after Philly Fed President Patrick Hunter said that the central bank shouldn’t be thinking about additional interest rate increases with so many small US businesses struggling to cope with its tightening cycle to date. Hunter is one of the Fed’s biggest doves, suggesting that rates should be held steady as they should already be sufficiently high to quell inflation.

 

  • flag european union 1f1ea 1f1faEURUSD continues to trade sideways bouncing off support around 1.05 and initially capped at 1.0560. Overnight, ECB Chief Economist Philip Lane said that policymakers must stand ready to take further action if additional shocks to inflation emerge.

Economic Calendar

:
AUD - Monetary Policy Meeting Minutes
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JPY - Tertiary Industry Activity m/m
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GBP - Claimant Count Change
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GBP - Average Earnings Index 3m/y
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GBP - Unemployment Rate
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CNY - Foreign Direct Investment ytd/y
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EUR - German ZEW Economic Sentiment
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EUR - ZEW Economic Sentiment
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GBP - MPC Member Dhingra Speaks
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EUR - ECOFIN Meetings
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GBP - 30-y Bond Auction
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USD - FOMC Member Williams Speaks
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CAD - Housing Starts
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CAD - CPI m/m
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CAD - Median CPI y/y
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CAD - Trimmed CPI y/y
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CAD - Common CPI y/y
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CAD - Core CPI m/m
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CAD - Foreign Securities Purchases
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USD - Core Retail Sales m/m
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USD - Retail Sales m/m
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USD - Industrial Production m/m
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USD - Capacity Utilization Rate
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USD - FOMC Member Bowman Speaks
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USD - Business Inventories m/m
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USD - NAHB Housing Market Index
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NZD - GDT Price Index
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EUR - German Buba President Nagel Speaks
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USD - Federal Budget Balance
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USD - TIC Long-Term Purchases
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AUD - RBA Gov Bullock Speaks
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AUD - MI Leading Index m/m

Market Indicators

Currency Pairs
Pair High Low
eur/gbp 0.86623 0.86427
gbp/usd 1.22159 1.21645
gbp/aud 1.9268 1.91429
gbp/nzd 2.07068 2.0626
usd/jpy 149.658 149.478
eur/usd 1.05608 1.05338
gbp/jpy 182.727 182.032
eur/cnh 7.7207 7.7088
usd/cnh 7.3218 7.3053
Equities and Commodities
Nasdaq 100 15174.6
DOW 33970.8
S&P 500 4372.38
BRENT CRUDE 89.77
WTI 86.69
GOLD 1919.69

This document is for information purposes only and does not constitute any recommendation or solicitation to any person to enter into any transaction or adopt any trading strategy, nor does it constitute any prediction of likely future movements in exchange rates or prices or any representation that any such future movements will not exceed those shown on any illustration. All exchange rates and figures appearing are for illustrative purposes only. You are advised to make your own independent judgment with respect to any matter contained herein.

About Simon Walker

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Simon Walker is head of the GPS Capital Markets trade desk in our London office where he is responsible for covering market risk in European hours. He has over 25 years’ experience in foreign exchange, working in both sales and trading.