Marketwatch EU & UK

Daily Insights
July 16, 2024

  • The US dollar rallied a touch yesterday as Federal Reserve Chairman Jerome Powell said that economic data in the second quarter has given FOMC policymakers greater confidence that inflation is heading down towards the central bank’s 2% target. His comments come after the softer than expected CPI release last week, possibly paving the way for an interest rate cut in September. The central bank has held rates steady at the highest level in over two decades for about a year now, with policymakers scheduled to meet again at the end of this month although most analysts feel that the upcoming meeting is too soon to pull the trigger on a reduction in borrowing costs.
  • The dollar edged higher yesterday on Powell’s comments ahead of the release of key Retail Sales data this afternoon. US consumers remain reluctant to splurge their hard-earned cash and the upcoming data will hopefully give an insight into current confidence of consumers as analysts gauge the health of the US economy. The single currency lost ground after recently rallying through the psychological 1.09 area but has so far failed to significantly breach resistance at 1.0920. The pair has drifted lower to once again consolidate in the high 1.08’s and back in a well-defined trading range ahead of the release of the German ZEW survey this morning.
  • GBPUSD remains well supported after breaching its recent trading range last week after the softer US inflation report. Cable has so far failed to break the key 1.30 level, peaking at 1.2995 but still hovers around a one year high. Consolidation is expected today ahead of a plethora of UK economic data in the coming days that may influence the Bank of England’s monetary policy stance.

Economic Calendar

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JPY - Tertiary Industry Activity m/m
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EUR - Italian Trade Balance
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EUR - Trade Balance
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EUR - ZEW Economic Sentiment
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EUR - German ZEW Economic Sentiment
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EUR - ECOFIN Meetings
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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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USD - Core Retail Sales m/m
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USD - Retail Sales m/m
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USD - Import Prices m/m
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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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USD - FOMC Member Kugler Speaks
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NZD - CPI q/q

Market Indicators

Currency Pairs
Pair High Low
eur/gbp 0.84032 0.83998
gbp/usd 1.29697 1.29612
gbp/aud 1.92363 1.91767
gbp/nzd 2.14173 2.13414
usd/jpy 158.726 158.106
eur/usd 1.08981 1.08886
gbp/jpy 205.77 205.018
eur/cnh 7.92976 7.9192
usd/cnh 7.27991 7.2708
Equities and Commodities
Nasdaq 100 20467.5
DOW 40321.6
S&P 500 5650.87
BRENT CRUDE 84.54
WTI 81.57
GOLD 2430.59

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.