Marketwatch EU & UK

Daily Insights
July 10, 2024

  • Federal Reserve Chairman Jerome Powell delivered the first part of his semi-annual testimony yesterday, with his comments broadly inline with his FOMC colleagues. His remarks suggest that the central bank is expecting to ease, but he gave no indication of timing. He did comment that “this is no longer an overheating economy” adding that “labor markets appear to be fully back in balance.” This could be interpreted as further cooling, and a slowing in the jobs market could signal rate cuts. Powell also added, “meeting to meeting” in his speech, which could keep a September rate cut on the table. He wraps up his testimony later today and the attention then shifts to tomorrow’s key CPI data to see if that provides any clues on when the Fed will shift policy.
  • The pound has dropped a tad against the US dollar, back trading on a 1.27 handle ahead of a key speech from BoE Chief Economist Huw Pill later today. Markets will be closely monitoring Huw’s comments to see if he continues recent dovish remarks following the recent slowdown in inflationary pressures. His speech comes ahead of next weeks key inflation report which is the final piece of the data puzzle ahead of the 1 August policy meeting.
  • EURUSD continues to consolidate, seemingly going nowhere fast and has struggled to significantly break higher over the past few days, remaining anchored around the 1.0820 level. The pair may be influenced by a surprise in tomorrow’s US CPI report with a breach of either 1.0790 or 1.0845 required to signify fresh direction.

Economic Calendar

:
CNY - CPI y/y
:
CNY - PPI y/y
:
NZD - Official Cash Rate
:
NZD - RBNZ Rate Statement
:
EUR - German Buba President Nagel Speaks
:
EUR - Italian Industrial Production m/m
:
GBP - MPC Member Pill Speaks
:
USD - Fed Chair Powell Testifies
:
USD - Final Wholesale Inventories m/m
:
USD - Crude Oil Inventories
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GBP - MPC Member Mann Speaks
:
USD - 10-y Bond Auction
:
USD - FOMC Member Bowman Speaks
:
USD - FOMC Member Goolsbee Speaks
:
NZD - FPI m/m
:
GBP - RICS House Price Balance
:
USD - FOMC Member Cook Speaks
:
JPY - Core Machinery Orders m/m

Market Indicators

Currency Pairs
Pair High Low
eur/gbp 0.8459 0.84548
gbp/usd 1.27962 1.27841
gbp/aud 1.89904 1.89595
gbp/nzd 2.10438 2.0845
usd/jpy 161.59 161.3
eur/usd 1.08211 1.08109
gbp/jpy 206.646 206.288
eur/cnh 7.89021 7.8786
usd/cnh 7.29359 7.28725
Equities and Commodities
Nasdaq 100 20515.3
DOW 39291.8
S&P 500 5587.53
BRENT CRUDE 84.09
WTI 80.96
GOLD 2367.76

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.