Marketwatch EU & UK

Daily Insights
August 13, 2024

  • The pound is a little higher this morning, with GBPUSD trading above 1.28 after data released earlier showed that the UK’s unemployment rate unexpectedly fell. The jobless rate in the three months through June fell to 4.2% from 4.4% – lower than the 4.5% that markets were expecting. A separate release showed that regular wage growth cooled to 5.4%, down from 5.8% in the previous period and the weakest year-on-year pay increase since the summer of 2022. Markets and BoE officials will be paying close attention to this and further data releases in the coming days ahead of the next MPC policy meeting on September 19th. Current betting suggests that officials will hold rates unchanged after rate setters cut by 25bp at their recent meeting with a November reduction remaining on the cards.
  • Middle East tensions are weighing on market sentiment with the dollar gaining along with gold and oil prices over concerns about a possible Iran attack on Israel. In a largely quiet start the week, the dollar index gained a little despite treasury yields falling a touch. Ahead of today’s PPI release the New York Fed’s survey of consumer expectations showed inflation expectations falling, with three-year period hitting the lowest mark since the survey’s inception in 2013.
  • The single currency continues to consolidate above 1.09 as markets await the release of the German ZEW survey. The German economy remains in a vulnerable position after its economy unexpectedly shrank in the second quarter even as other euro area countries expanded. The ZEW survey is the first significant data release of the month for the bloc and will be monitored for clues on the timing of the next interest rate cut from the ECB.

Economic Calendar

:
AUD - Westpac Consumer Sentiment
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AUD - Wage Price Index q/q
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AUD - NAB Business Confidence
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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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JPY - Prelim Machine Tool Orders y/y
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CNY - New Loans
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CNY - M2 Money Supply y/y
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EUR - German ZEW Economic Sentiment
:
EUR - ZEW Economic Sentiment
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USD - NFIB Small Business Index
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USD - Core PPI m/m
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USD - PPI m/m
:
USD - FOMC Member Bostic Speaks

Market Indicators

Currency Pairs
Pair High Low
eur/gbp 0.85639 0.85587
gbp/usd 1.27798 1.27632
gbp/aud 1.94031 1.93592
gbp/nzd 2.12139 2.1164
usd/jpy 147.793 147.002
eur/usd 1.09399 1.09292
gbp/jpy 188.834 187.654
eur/cnh 7.85586 7.8419
usd/cnh 7.18306 7.17416
Equities and Commodities
Nasdaq 100 18615.2
DOW 39447.7
S&P 500 5360.01
BRENT CRUDE 81.72
WTI 79.68
GOLD 2459.31

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.