UK: Weekly FX Market Update 11 September
As BoE Governor Bailey advises that the peak for UK rates is near, GBPUSD trades at 3-month lows.
GBPEUR takes a back seat as well, this is despite Bailey warming of a possible higher inflation reading to come.
Will average earnings released on Tuesday push higher? Will GDP on Wednesday expand slowly again?
What impact will US CPI, released on Wednesday, have on GBPUSD?
What will GBPEUR’s reaction be to the ECB rate decision on Thursday?
The EURUSD has been pushed lower by a strong US dollar, and warnings of eurozone stagflation by ECB member Schnabel.
ECB members Knot and Kazimir however, have hinted that a September rate hike is still a ‘possibility’.
Bloomberg gives a 35% chance of a rate hike from the ECB on Thursday, suggesting that any decision could move the market.
If they do hike, will that be a surprise and help lift the Euro?
Boston Fed president Collins warns that further Fed tightening ‘may be warranted, depending on the data.’
US CPI is released on Wednesday. Market expectations are for a yearly gain of 3.6% and monthly 0.5%.
Retail sales are due out on Thursday and consumer sentiment on Friday.
After last weeks data drought, will volatility return this week?
Main events for this week:
Mon Sep 11
GBP 09:00 MPC Pill speaks
Tue Sep 12
07:00 GBP Claimant count change/Average earnings index/Unemployment rate
10:00 EUR ZEW Economic sentiment
Wed Sep 13
07:00 GBP GDP/Industrial and manufacturing production/Goods trade balance
13:30 USD CPI
Thu Sep 14
13:15 EUR ECB Interest rate decision
13:30 USD PPI/Retail sales
13:45 EUR ECB press conference
Fri Sep 15
09:30 GBP Consumer inflation expectations
13:30 USD Empire State manufacturing index
14:15 Industrial production
15:00 USD Prelim UoM consumer sentiment