27/ 06/ 2017

Week Ahead I Big Data and Big Speculation will set the Tone for the Week

After what had been a pretty quiet week on the economic calendar, things are certainly more chaotic this week and we can expect markets to be getting ready for a choppy week that not only includes plenty of economic indicators to consider, but also central bank commentary. As we saw last week, central bankers have continued to rule the roost in the current markets, with there being plenty of uncertainty over monetary policy, particularly in the UK and the U.S.

Today’s focus brings a number of speeches from central bank governors, and they definitely are worth a closer look as it is likely that a few of them might touch upon the monetary policy during their speeches. 

22/ 06/ 2017

Dollar looks Positive with the Pound vying for the Spotlight

The pound has continued to dominate the attention of the markets through the week, with contradictory sentiment from members of the Monetary Policy Committee causing confusion amidst the current political storm that is passing over Westminster. The Pound continues to trade in a volatile manner and till yesterday, the Queen’s speech had been delayed and that had raised some concerns over the government formation and how stable the new government would be but with things becoming more and more clear, the pound has been able to stabilise and move higher as of today. This has brought some cheer to the pound bulls but now they have to get themselves ready for the volatility that is likely to arrive as the Brexit talks proceed. This is likely to be a long and arduous process and they have to handle this process carefully. The pound is likely to be pulled this way and that in the meantime.

Looking ahead, the economic data today will see ECB economic bulletin delivering a favourable outlook to Eurozone growth for the 2nd quarter, with the ECB also talking up global growth in the current quarter.  Among central bank speeches, BoE Member, Kristin Forbes, who voted for a rate hike will be speaking today while FOMC Member Powell will be speaking in regards to the Fed's policies any comments on monetary policy will likely be of greater influence, central bank commentary certainly driving the majors through the week.

21/ 06/ 2017

Euro & Pound Facing Headwinds against USD

The dollar hit a one-month high on Tuesday against a basket of currencies on the view the Federal Reserve may raise interest rates once more this year, the greenback grinded higher following comments from New York Fed President William Dudley on Monday who said further improvement in the U.S. labour market would kindle inflation, which has shown signs of flagging in recent months. If it were to rebound, this would leave the door open for the possibility of another rate hike by year-end after two hikes so far this year. while sterling tumbled after the Bank of England's head threw cold water on the notion it was close to raising rates. The dollar fared best against the British pound among major currencies. It gained after BoE Governor Mark Carney said now was not the time to raise UK interest rates.

Late in the day, we have the Bank of England (BoE) MPC Member Haldane’s speech and Bank of Japan Governor Kuroda’s speech.

20/ 06/ 2017

Central Bankers Drive the Dollar and the Pound

Another quiet day on the economic calendar leaves central bankers in the spot light once more, with the Dollar having found support off FOMC voting member Dudley’s hawkish commentary on Monday, the Chicago FED President simply highlighting his support for a gradual increase in interest rates coupled with a slow reduction in the FED’s balance sheet.

The Euro and the Pound however struggled yesterday against the U.S Dollar. Brexit talks have officially begun between the European Union and the U.K in order to achieve a working outline.  Political worries continue to hamper Prime Minister May and her Tory led government, because of their weakened mandate after the humiliating election results nearly two weeks ago. 

Today’s all eyes will be on BOE Governor Carney & US FOMC Member Stanley Fischer speeches.