Marketwatch EU & UK

Daily Insights
August 9, 2024

  • Global markets heaved a collective sigh of relief yesterday when US weekly jobless claims came in a little better than expected. The print of 233k was ahead of estimates and an improvement on last week’s release which was revised up slightly to 250k from 249k. The data eased some fears of a US recession after poor employment market data last week, triggering an equity sell off. Risk appetite improved and the greenback lost some ground, and a large amount of JPY funded carry trades have been washed out. US treasury yields were a little lower again as the market continues to look for clues on the size of any rate cut from the Fed at their September meeting.
  • The Japanese yen continues to dominate market action, with USDJPY gyrating between gains and losses ahead of a holiday in Japan on Monday. Markets remain under the impression that the BoJ will likely avoid raising interest rates any time soon, with any future tightening expected to be dependant on the outlook for the US economy and path of their interest rates with officials nervous of the spread in yields widening too much.
  • We continue to monitor Fedspeak and yesterday Federal Bank of Kansas President Jeffrey Schmid suggested that he is not ready to support a rate cut with inflation above target and the labor market still looking healthy despite signs of cooling. He did not drop any clues on when the Fed might cut, saying, “we are close, but we are still not quite there.”
  • EURUSD is consolidating in the low 1.09’s after a brief trip lower to test support at 1.0880 as the pair seeks direction. GBPUSD is consolidating in the high 1.27’s ahead of a busy week of data next week which includes the jobs report and July inflation print.

Economic Calendar

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CNY - CPI y/y
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CNY - PPI y/y
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EUR - German Final CPI m/m
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CHF - SECO Consumer Climate
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EUR - Italian Trade Balance
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CAD - Employment Change
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CAD - Unemployment Rate
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USD - Mortgage Delinquencies

Market Indicators

Currency Pairs
Pair High Low
eur/gbp 0.85665 0.85583
gbp/usd 1.27628 1.27377
gbp/aud 1.9368 1.93155
gbp/nzd 2.12289 2.11333
usd/jpy 147.776 146.714
eur/usd 1.09244 1.09114
gbp/jpy 188.305 187.033
eur/cnh 7.84591 7.8207
usd/cnh 7.1898 7.16253
Equities and Commodities
Nasdaq 100 18390.5
DOW 39449.6
S&P 500 5315.93
BRENT CRUDE 79.12
WTI 76.25
GOLD 2422.55

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.