UK: Weekly FX Market Update 6 July

GBP

• Sterling pushed quietly higher last week as Prime Minister to be Burnham, decides his policies & Cabinet.

• Will Miliband be Chancellor & if so, how will investors react?

• Will FOMC meeting minutes confirm new Fed Chair Warsh’s inflation fighting credentials?

EUR

• Eurozone CPI falls to 2.8% with ECB Board member Wunsch saying that ‘one hike could suffice’.

• Will a combination of sluggish Eurozone GDP growth & softening inflation keep the Euro weak?

• How will retail sales on Monday & ECB meeting accounts on Thursday affect the single currency this week?

USD

• Is Warsh an inflation hawk or dove? He says he is committed to price stability but talks about productivity gains & softer inflationary pressures.

• The new Fed Chair decides that forward guidance was useful in the financial crisis but not now. So, markets try to double guess the Fed’s real intent.

• After a weak unemployment report last Friday, what will the FOMC meeting minutes on Wednesday show?

Mon Jul 6

09:30 EUR Sentix Investor Confidence

10:00 EUR Retail Sales

15:00 USD ISM Services PMI

Tue Jul 7

07:00 EUR German Industrial Production

10:30 GBP BoE Financial Stability Report

Wed Jul 8

19:00 USD FOMC Meeting Minutes

Thu Jul 9

12:30 EUR ECB Monetary Policy Meeting Accounts

13:30 USD Unemployment Claims

Fri Jul 10

13:30 CAD Employment Change/Unemployment Rate