Archive: May2017

Poor performing Pound continues

31 May 2017
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US Dollar

Expected Range 1.2820 – 1.2950

Sterling loses further ground against the US dollar. This follows Thursdays GDP latest from the UK as the second estimate failed to meet forecast. GDP growth quarter 1 2017 was revised 0.1 percentage point lower than the 0.3 percent expected as rising inflation hit consumer-faced industries such as retail and accommodation. Unemployment claims was released states side pm Thursday. The latest number of individuals who filed for unemployment insurance the past week grew slightly, but came in pretty much as previously released – 234k actual versus 233k previous. Gradual gains for the US Dollar now takes the currency pair back below 1.2900. GBP/USD 1.2874 – 09:30am.

We are to see further key data today ahead of the bank holiday weekend. Both releases are in the US, the first being core durable goods orders which will show the total value of new purchase orders placed with manufacturers. A forecast higher to 0.4% expected versus a previous 0.0%. Prelim GDP q/q is the other, where a revision higher is also anticipated. Positive news against these releases only further supports the Americas June rate hike and this should see the US dollar strengthen.

Euro

Expected Range 1.1410 – 1.1540

Euro gains against the Pound. As the 19-nation currency had only low impact data to consider, data elsewhere was the main driver for these gains. As previously mentioned, GDP data from the UK weakened the Pound further in which the Euro capitalised. Outside of this however, one eye has been on the polls for the upcoming UK election and early this morning YouGov poll showed a narrowing in the conservative lead to 5 points over the Labour party. EUR/USD which had been trading under 1.1200 overnight has pushed back above this figure this morning. GBP/EUR 1.1467 – 09:30am.

Data elsewhere will drive the GBP/EUR cross today with no local macroeconomic data to take into consideration. The G7 meeting begins today and data in the US, already mentioned, will also be monitored for movement today.

Australian Dollar

Expected Range 1.7230 – 1.7420

Sterling sits lower against the Aussie. Pound had seen gains against the Aussie yesterday, despite UK GDP showing a red figure, but is back off the boil this morning. As we near closer the UK election, the early polls are starting to be monitored and this morning we have seen a narrowing in the conservative lead. As such, GBP/AUD nears the lower end of recent ranges. GBP/AUD 1.7307 – 09:30am.

New Zealand Dollar

Expected Range 1.8190 – 1.8380

Kiwi has slowly chipped away at Sterling the past 24 hours. Little macroeconomic data to discuss means we are looking at the same GDP and poll latest, previously mentioned. GBP/NZD has dipped below 1.8300 which gives guidance on the poor performance of the Pound this week. GBP/NZD 1.8267 – 09:30am.

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New Kids on The Block – G7 Leaders Meet

26 May 2017
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The 2017 G7 summit will be taking place in Sicily on Friday and there are a few new faces since last year’s meeting. Four out of the seven countries – the UK, US, France and Italy are under new leadership; however, all eyes will be fixed on Donald Trump. Italy chose Sicily as a venue […]

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Poor performing Pound continues

25 May 2017
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US Dollar

Expected Range 1.2820 – 1.2950

Sterling loses further ground against the US dollar. This follows Thursdays GDP latest from the UK as the second estimate failed to meet forecast. GDP growth quarter 1 2017 was revised 0.1 percentage point lower than the 0.3 percent expected as rising inflation hit consumer-faced industries such as retail and accommodation. Unemployment claims was released states side pm Thursday. The latest number of individuals who filed for unemployment insurance the past week grew slightly, but came in pretty much as previously released – 234k actual versus 233k previous. Gradual gains for the US Dollar now takes the currency pair back below 1.2900. GBP/USD 1.2874 – 09:30am.

We are to see further key data today ahead of the bank holiday weekend. Both releases are in the US, the first being core durable goods orders which will show the total value of new purchase orders placed with manufacturers. A forecast higher to 0.4% expected versus a previous 0.0%. Prelim GDP q/q is the other, where a revision higher is also anticipated. Positive news against these releases only further supports the Americas June rate hike and this should see the US dollar strengthen.

Euro

Expected Range 1.1410 – 1.1540

Euro gains against the Pound. As the 19-nation currency had only low impact data to consider, data elsewhere was the main driver for these gains. As previously mentioned, GDP data from the UK weakened the Pound further in which the Euro capitalised. Outside of this however, one eye has been on the polls for the upcoming UK election and early this morning YouGov poll showed a narrowing in the conservative lead to 5 points over the Labour party. EUR/USD which had been trading under 1.1200 overnight has pushed back above this figure this morning. GBP/EUR 1.1467 – 09:30am.

Data elsewhere will drive the GBP/EUR cross today with no local macroeconomic data to take into consideration. The G7 meeting begins today and data in the US, already mentioned, will also be monitored for movement today.

Australian Dollar

Expected Range 1.7230 – 1.7420

Sterling sits lower against the Aussie. Pound had seen gains against the Aussie yesterday, despite UK GDP showing a red figure, but is back off the boil this morning. As we near closer the UK election, the early polls are starting to be monitored and this morning we have seen a narrowing in the conservative lead. As such, GBP/AUD nears the lower end of recent ranges. GBP/AUD 1.7307 – 09:30am.

New Zealand Dollar

Expected Range 1.8190 – 1.8380

Kiwi has slowly chipped away at Sterling the past 24 hours. Little macroeconomic data to discuss means we are looking at the same GDP and poll latest, previously mentioned. GBP/NZD has dipped below 1.8300 which gives guidance on the poor performance of the Pound this week. GBP/NZD 1.8267 – 09:30am.

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UK Terror Threat Level Critical

24 May 2017
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In the wake of the atrocious attack on Manchester Arena, prime minister Theresa May, confirmed that the UK terror threat level was raised to its highest level of “critical”, on Tuesday evening.   The critical terror threat level means that a terrorist attack is imminent, and has resulted in military personnel being deployed to protect […]

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Arrest Made After Heartless Manchester Attack

23 May 2017
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Greater Manchester police have arrested a man in connection with the heartless Manchester Arena bomb attack that took place on Monday evening. On Tuesday, police detained a 23-year-old man in the south of the city in relation to the brutal attack, which killed 22 people, including children, who were enjoying the Ariana Grande concert prior to […]

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Euro stumbles on mixed ECB views

23 May 2017
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US Dollar

Expected Range 1.2900 – 1.3060

Sterling opens under the big 1.3000 versus the US Dollar. The currency pair also traded under this rate for the most of yesterday. Early in Tuesdays session, UK public sector net borrowing showed a red figure decreasing £23.4 billion to 48.7 billion in the financial year ending March 2017, compared with the financial year ending March 2016. The release was overshadowed however by the terrorist attack in Manchester, which was already weighing on the Pound yesterday morning. Cable did break 1.3000 however, after the US released new home sales figures, as March’s strongest selling pace in a decade saw a stumble in April – 611k expected and 569k actually realised. GBP/EUR 1.2985 – 09:30am.

The first key release for the currency pair gets released at 7pm tonight. The US FOMC meeting minutes will bring the latest from the recent meetings between the FED members, offering an in-depth insight into the economic and financial conditions. Any indicators on interest rate hike influences will be anticipated.

Euro

Expected Range 1.1510 – 1.1680

Euro has lost a little ground against the Pound and US dollar. As mentioned in yesterday’s commentary, early data releases from Germany and Europe supported recent gains for the EUR with manufacturing, services and business climate data all posting good numbers. Benoit Coeure, arguably one of the most influential members of the ECB, however seems to be the reason EUR weakened Tuesday afternoon communicating thoughts on the ECB unwinding stimulus. Coeure warned that moving too slowly could eventually lead to a bigger shock, which is a contrasting view to Peter Praet who is an advocate for a cautious approach maintaining the easing bias. The different viewpoints have spooked markets as we edge closer to the June 8 policy meeting. GBP/EUR has broken 1.1600 and EUR/USD has fallen back below 1.1200. GBP/EUR 1.1598 – 09:30am.

The day ahead sees ECB President Draghi speaking at the first conference on financial stability in Madrid. Draghis words will be deciphered as to where he sits in the management of stimulus. Elsewhere, the FOMC meeting will also be eagerly anticipated.

Australian Dollar

Expected Range 1.7270 – 1.7430

After the UK public sector net borrowing yesterday, there was little in data to influence GBP/AUD. Sterling took a further fall against the Aussie on the release, but has since recovered breaking through 1.7400 overnight. This may have been helped by Australian construction work data coming in lower than expected as well as previous. GBP/AUD 1.7377 – 09:30am.

New Zealand Dollar

Expected Range 1.8420 – 1.8570

The Kiwi has also lost ground against the Pound. In the next 24 hours we will have seen the annual budget release from New Zealand which is the only key release for the location this week. Until then, the Kiwi has mimicked the Aussie in its losses against the Pound yesterday, into today. GBP/NZD 1.8502 – 09:30am.

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Ford CEO Parts Company

23 May 2017
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Car giant Ford confirmed on Monday that CEO, Mark Fields will be entering retirement with immediate effect and will be replaced by James Hackett, Ford’s head of its self-driving car development unit. The decision was in response to Ford’s investors’ growing apprehension over the carmaker’s stock performance and its prospects. Field’s departure comes as Ford […]

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Euro continues to gain ground

22 May 2017
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US Dollar

Expected Range 1.2950 – 1.3040

Cable has traded within a narrow range the past 24 hours. As there was little macroeconomic data yesterday, neither the Pound or the Greenback has had much guidance for movement. Early Monday, the Pound did weaken after polls showed that the conservative party lead had narrowed. British Prime Minister Theresa May has believed to hindered her campaign recently over proposals for a shakeup in social care. Despite the news taking cable back below 1.3000, it was short lived as the currency pair continued to yo-yo through 1.3000 throughout yesterday. Sterling under a little pressure this morning also as markets absorb the terrorist attack in Manchester which has killed 22 and injured 59 at time of writing. GBP/USD 1.2986 – 09:00am.

Ahead we see no high impact data from either the UK or the US. UK public sector net borrowing is worth noting as well as a number of FOMC members speaking in the US this afternoon. Outside of this, US also has new homes sales. This is all a prelim to tomorrows FOMC meeting, the first key data for these two currencies.

Euro

Expected Range 1.1450 – 1.1560

The single currency continues to gain ground against the Pound and US Dollar. A number of factors have led to Euros break below 1.1550 against the Pound and above 1.1250 versus the Greenback such as political certainty breeding confidence that other countries will not exit the EU, financial stability slowly being achieved over troubled EU nations, US dollar weakness due to the ongoing Trump saga… The feel good factor that now supports the Euro is also being backed up by domestic data. German manufacturing output, released earlier this morning, was its sharpest increase since April 2011 and a survey into German business climate exceeded expectations – 114.6 versus 113.1. GBP/EUR 1.1540 – 09:00am.

As the key economic data for today has already been released in Europe, only low impact data to anticipate from the UK and US. I would imagine on this basis; Euro strength remains on the agenda.

Australian Dollar

Expected Range 1.7180 – 1.7360

There is little to discuss out of general market movement for the Aussie, as there is no data worth mentioning. The change in polls has seen the Pound slip further against the Aussie and this has been seen overnight also. Resistance has been seen 1.7300, but we aren’t far from this price for today’s start. GBP/AUD 1.7327 – 09:00am.

New Zealand Dollar

Expected Range 1.8350 – 1.8570

No domestic data to discuss for the Kiwi with investors looking ahead to domestic trade balance figures. This is outside of the latest political uncertainty from the US and pending FOMC meeting minutes. GBP/NZD 1.8473 – 09:00am.

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Cable drops back below 1.3000

21 May 2017
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US Dollar

Expected Range 1.2900 – 1.3040

Sterling yo-yos 1.3000 versus the US Dollar. The Pound had little macroeconomic data to feed off on Friday after breaking 1.3000 Thursday as retail sales figures exceeded expectation. UK Industrial orders was the only release of note Friday, as a low impact release, and order books improved on April. The survey of 432 manufacturers reported that total order books were the highest since February 2015 and export orders also stayed robust. Despite Sterling advancing around the time of this release, the move has been pinned to political turmoil in the US as President Trump asked former FBI Director Comey to end the agency’s investigation into ties between former White House national security advisor Michael Flynn and Russia. Cable is seeing support around 1.2970 on the slip lower this morning, with the next support being seen at 1.2900. GBP/USD 1.2982 – 9:30am.

Speeches from both sides of the pond will be the only driver in the currency pairs movement today. This is ahead of a busy week, starting with tomorrows UK inflation report hearing.

Euro

Expected Range 1.1590 – 1.1680

Euro continues to advance against the Pound and US Dollar. High impact data for the EUR was thin on the ground Friday, but releases were seen in both German producer prices and Eurozone current accounts. German producer prices rose 3.4% compared with the corresponding month of the preceding year. Is was also the highest annual increase since December 2011. Current account also posted a green figure recording a surplus of €34.1 billion. However, the single currency would have taken direction early Friday from political turmoil in the US as well as expectations that the ECB will soon begin tempering its accommodative monetary policy platform amid improved macroeconomic indicators. EUR/USD had reached 1.1210 overnight, but we are just off these highs this morning. GBP/EUR 1.1623 – 9:30am.

Data all this week will likely drive volatility in the EUR, starting the week with the Eurogroup meetings and tomorrows German Ifo business climate.

Australian Dollar

Expected Range 1.7330 – 1.7530

The Australia dollar has advanced against the Pound this morning. Friday saw Sterling attempt to break 1.7500 versus the Aussie after UK retail sales figures on Thursday coming in much greater than predicted. Two failed attempts have since seen the Aussie fight back and is now the closer side of 1.7400. GBP/AUD 1.7423 – 9:30am.

New Zealand Dollar

Expected Range 1.8580 – 1.8890

The Kiwi has joined the Aussie in its gains against the Pound this morning. Just after midday Friday, GBP/NZD had pushed to break 1.8900 but the failed attempt has since seen the currency pair slide into the start of this week. The pair has just broken 1.8700 on the fall. GBP/NZD 1.8685 – 9:30am.

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Cable drops back below 1.3000

21 May 2017
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US Dollar

Expected Range 1.2900 – 1.3040

Sterling yo-yos 1.3000 versus the US Dollar. The Pound had little macroeconomic data to feed off on Friday after breaking 1.3000 Thursday as retail sales figures exceeded expectation. UK Industrial orders was the only release of note Friday, as a low impact release, and order books improved on April. The survey of 432 manufacturers reported that total order books were the highest since February 2015 and export orders also stayed robust. Despite Sterling advancing around the time of this release, the move has been pinned to political turmoil in the US as President Trump asked former FBI Director Comey to end the agency’s investigation into ties between former White House national security advisor Michael Flynn and Russia. Cable is seeing support around 1.2970 on the slip lower this morning, with the next support being seen at 1.2900. GBP/USD 1.2982 – 9:30am.

Speeches from both sides of the pond will be the only driver in the currency pairs movement today. This is ahead of a busy week, starting with tomorrows UK inflation report hearing.

Euro

Expected Range 1.1590 – 1.1680

Euro continues to advance against the Pound and US Dollar. High impact data for the EUR was thin on the ground Friday, but releases were seen in both German producer prices and Eurozone current accounts. German producer prices rose 3.4% compared with the corresponding month of the preceding year. Is was also the highest annual increase since December 2011. Current account also posted a green figure recording a surplus of €34.1 billion. However, the single currency would have taken direction early Friday from political turmoil in the US as well as expectations that the ECB will soon begin tempering its accommodative monetary policy platform amid improved macroeconomic indicators. EUR/USD had reached 1.1210 overnight, but we are just off these highs this morning. GBP/EUR 1.1623 – 9:30am.

Data all this week will likely drive volatility in the EUR, starting the week with the Eurogroup meetings and tomorrows German Ifo business climate.

Australian Dollar

Expected Range 1.7330 – 1.7530

The Australia dollar has advanced against the Pound this morning. Friday saw Sterling attempt to break 1.7500 versus the Aussie after UK retail sales figures on Thursday coming in much greater than predicted. Two failed attempts have since seen the Aussie fight back and is now the closer side of 1.7400. GBP/AUD 1.7423 – 9:30am.

New Zealand Dollar

Expected Range 1.8580 – 1.8890

The Kiwi has joined the Aussie in its gains against the Pound this morning. Just after midday Friday, GBP/NZD had pushed to break 1.8900 but the failed attempt has since seen the currency pair slide into the start of this week. The pair has just broken 1.8700 on the fall. GBP/NZD 1.8685 – 9:30am.

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