Marketwatch EU & UK

Daily Insights
June 19, 2024

 

  • The sterling is little changed following a small gain that held the pair above 1.27 right after the release of UK inflation, which slowed down in line with expectations, but the services gauge came in higher than expected. This move above 1.27 may be short-lived and the markets don’t seem too excited as we have the Bank of England meeting tomorrow and UK general Elections at the beginning of July.
  • May CPI dropped to the desired 2% target and estimate YoY, from the previous 2.3% while services CPI stayed “sticky”, only cooling to 5.7% above the 5.5% estimate.

 

  • It is Juneteenth holiday in the US and the US Dollar Index holds above 105 after a group of Federal Reserve officials stressed the need for further evidence that inflation is cooling before reducing borrowing costs.
  • Fed Governor Adrian Kugler stated that such move would be appropriate “sometime later this year” and St. Louis Fed President Alberto Musalem added to his colleague words that it could take “quarters” for the data to support a reduction in interest rates.

 

  • The Euro continues to hold above 1.07 and traded as high as 1.0760 yesterday but quickly reversed and currently trades around 1.0730. The pair found support on these levels after unchanged US Retail Sales data failed to lift the greenback and led to some speculation for more than 1 rate cut this year. The market is short euro in the near term given the Fed continues to hold the view of “higher for longer” and due to the current political instability in France and the next key support can be found near 1.0650.

Economic Calendar

:
GBP - CPI y/y
:
GBP - Core CPI y/y
:
GBP - PPI Input m/m
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GBP - PPI Output m/m
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GBP - RPI y/y
:
CNY - Foreign Direct Investment ytd/y
:
EUR - Current Account
:
GBP - HPI y/y
:
All - G7 Meetings
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EUR - German 30-y Bond Auction
:
USD - Bank Holiday
:
USD - NAHB Housing Market Index
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CAD - BOC Summary of Deliberations
:
NZD - GDP q/q

Market Indicators

Currency Pairs
Pair High Low
eur/gbp 0.84546 0.84338
gbp/usd 1.2724 1.26995
gbp/aud 1.90808 1.90449
gbp/nzd 2.0728 2.06863
usd/jpy 157.924 157.721
eur/usd 1.07423 1.07328
gbp/jpy 200.77 200.377
eur/cnh 7.81451 7.8024
usd/cnh 7.27662 7.26829
Equities and Commodities
Nasdaq 100 19943.8
DOW 38809.1
S&P 500 5492.33
BRENT CRUDE 85.22
WTI 80.76
GOLD 2329.9

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 Francisco Mioludo

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Francisco Mioludo is a trader for GPS Capital Markets at the London office. Before joining GPS, Francisco worked in Market Risk at a commodity trading firm in London where he gained valuable skills for his current role. Francisco looks after our EU and UK sales team with everything from analysis to structuring and pricing.