Category Archives: FX News

Dollar Gains on Tariff Talks as Markets Await US Inflation Data
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Money News Overview Tuesday 4th June: All eyes will be on this weeks ECB policy announcement

It is a quiet day for the markets with only a handful of data due.

Early this morning, we have the German employment figures, followed later by the US factory orders & JOLTS – job opening numbers.

Markets will be looking ahead to this week’s ECB monetary policy announcement on Thursday and the US labour market report on Friday.

There is a high expectation that the ECB will cut rates on Thursday. Because of this, the decision itself is unlikely to be a shock to markets, what will move the market is the guidance thereafter on future rate cuts.

As always, the highlight is the meeting that follows the rate announcement. There is still a strong chance the euro will weaken towards the end of the week following the announcement.

Sterling has begun the week in buoyant fashion, touching 3-month highs against the US Dollar and holding on to its end-week gains against the euro.

This comes on the back of a 21-month high against the euro after Mays inflation figures showed that April inflation was stronger than had been expected. This helped sure markets that an interest rate reduction was unlikely to happen in June, which boosted the pound.

The euro to dollar exchange rate hit a new three-month high overnight, following recent data out from the US that has been softer than expected.

All eyes in the US will be on Friday’s data.

US-China Tariff Deal Lifts Dollar as Markets Await Key UK Data
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Money News Overview Monday 3rd June: ECB interest rates and US Non-Farm Payrolls expected to dominate markets this week

Purchase Manager Index are the major releases this morning.

The UK is set to release its Manufacturing Index, where It is expected to post a positive number. Last month, markets saw the sector fall below the 50-expansion level. However, forecasts are expected to come back in above the 50 level at 51.3.

As the week goes on, German Employment data is the key release tomorrow. Markets are poised to tune in to this release as employment is a key indicator to the current state of the economy.

Wednesday is the busiest day of the week in terms of economic releases, with the European Central Bank releasing their Interest Rate Announcement. Markets have pencilled in a cut of 0.25%.

In the build up to this event, the currency market may experience some volatility.

As for key US releases this week, Non-Farm Payrolls are released on Friday. Markets are forecasting a rise to 190k (from 175k)

The pound has continued to stay at yearly highs for the GBP/EUR rate. As we get closer to the release of the ECBs interest rate announcement on Wednesday, market fluctuations will be heightened. Any cut in rate and markets will likely see the pound increase its strength against the euro.

As for GBP/USD we are still sitting at the highest level since March.

Bank of England Interest Rate Decision and Pound Reaction Amid US Developments
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Money News Overview Friday 31st May: Inflation data in the spotlight

In the Eurozone, the EC confidence indices rose, although the industrial sector index came in slightly below expectations.

Meanwhile, the latest weekly initial unemployment claims figure rose to 219k from 216k. Overall, the data indicate that the Eurozone economy is gaining speed, while economic circumstances in the United States are deteriorating. 

Against this backdrop, the dollar experienced some downward pressure yesterday. However, the greenback recouped the majority of its losses overnight. 

In the Eurozone, the flash reading of HICP inflation is expected to jump to 2.5% in May from 2.4%. However, core inflation is expected to remain steady. 

Similarly, US core PCE inflation is predicted to remain at 2.8% in April. In the United States, personal income and consumption data for April will also be available. Aside from the releases, month-end flows may affect currency markets. 

Markets Await Federal Reserve FOMC Meeting as Sterling Rises and Euro Struggles
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Money News Overview Thursday 30th May: Eurozone and US Employment figures the major releases today

European Consumer Confidence is the major economic release this morning. Markets are forecasting an increase in confidence to -14.3 up from -.14.7.

Todays data will be released alongside employment figures for the Eurozone. The percentage of the total Eurozone work force that was unemployed and seeking work during the previous month is expected to stay at 6.5%.

Looking ahead today, the US will also release their Employment figures, markets are expecting the number of people who filled for unemployment benefits for the first time in the US to come in higher than last weeks figure of 215k. This is a key indicator to the US economic outlook.

Alongside this, Gross Domestic Product for the USA will also be reported. It is widely expected that GDP will have fallen massively to 1.3% quarter on quarter from 3.2%.

With no real major economic releases for the UK this week, the focus will shift to the European Central Banks Consumer Price Index Flash Estimate. Investors will keep a close eye on this, as a June rate cut is potentially on the cards for June. Inflation is expected to stay unchanged at 2.8%.

The pound has continued its strength against both the euro and the dollar, with markets reacting well to the news of the UKs general election in July. This could present an opportunity to take advantage of the rates, with the pound reaching month highs on the dollar and near two-year highs on the euro.

Markets await a potential Bank of England interest rate cut this week. Read our latest insights on how this and global data releases could impact the pound.
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Money News Overview Wednesday 29th May: German inflation forecasted to climb

Today there is no UK economic data, therefore attention will turn to the European Union releases. In Spain, retail sales fell to 0.3 percent in April showing consumer spending is decreasing and has significantly dropped from the high of the year to 1.9 percent.

Consumer confidence in France came in below the market consensus of 90. Italian data is expected to come in the green, as the sentiment of consumers towards the Italian economy slowly rises.

This afternoon, markets will keep a close eye on the German CPI inflation report to hopefully get a better understanding of the European Central Banks position on future rate cuts.

Preliminary German CPI and EU-harmonized CPI are both forecasted to rise from their previous two releases. The movement in the price of goods and services could give more reason for the ECB to hold interest rates, however this is unlikely.

Pound Sterling has been well supported by the call for a general election on July 4th. GBPEUR is trading well above its average for this year & GBPUSD achieved a 3-month high yesterday.

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