Without any economic reports from the U.K., the pound was simply chillin’ like ice cream fillin’ on the charts in yesterday’s trading. It ended the day 23 pips higher at 1.6011 against the dollar. Meanwhile, it was almost unchanged against the yen finishing the day 4 pips below its opening price at 125.08.
Our forex calendar still doesn’t have anything from the U.K. today. This probably means that we’ll see the same driver of global risk sentiment influence the pound today.
Don’t get too lax though! Market sentiment could change drastically with all the developments happening in the euro zone. Keep in mind that the pound usually does well when risk appetite is up but often trades lower when risk aversion is in play.
Make that back to back, sire! Thanks to improved risk appetite, GBP/USD rose for the second straight day, as the pair climbed 35 pips to finish at 1.6046. Can the bulls make it three in row?
Even with no hard data release from the U.K. yesterday, the pound was able to rally thanks to a positive reaction to the U.S. weekly jobless claims report. Make sure y’all hit up my USD commentary for the 411 on unemployment claims data!
For today, we’ve got nothing lined up once again, but that doesn’t mean you can just take chill pill. Over the past couple of days, we’ve been hearing from government officials (Chancellor Osborne) and MPC members (Martin Weale) talk about the economy and the effectiveness of the Bank of England’s monetary policy. If we hear more surprise comments today, it could set the tone for pound trading during the London session.
Aha! It looks like traders were as excited as Twilight fans are over the upcoming Breaking Dawn movie last Friday. Rumors that a Spanish bailout and a PBOC rate cut would happen over the weekend encouraged risk taking and allowed higher-yielding currencies, including the pound, to rally against the dollar and the yen.
GBP/USD finished the week at 1.6077, 31 pips above Friday’s opening price, while GBP/JPY closed at 126.04 after opening at 125.71.
There wasn’t a lot of market-moving data released from the U.K. last week which made the pound quite vulnerable to market sentiment. However, with our forex calendar filled with a handful of top-tier events from London in the coming days, brace yourselves for more volatility from the pound.
The very first major report is the U.K.'s CPI report which will be released tomorrow at 8:30 am GMT. September’s headline figure is anticipated to clock in at 2.2% while the core reading is seen at 2.1%.
On Wednesday, a couple of figures on employment will be on tap and are scheduled along with the MPC meeting minutes. Then finally, on Thursday, the retail sales report for September is anticipated to come in at 0.5%.
GBP/USD traded in an almost perfect “U” pattern yesterday as it fell during the Asian session but recovered nicely once the European trading session rolled along. It began the day at 1.6075 and closed the day barely changed at 1.6071.
The U.K. didn’t release any major reports yesterday so GBP/USD’s up and down movement was most likely the result of the mixed data that came out from the U.S. While the U.S. retail sales came out notably better than expected, the empire state manufacturing index disappointed the market and failed to meet forecast.
U.K.’s economic cupboard is filled to the brim today as a couple of tier 1 data is scheduled for release. At 8:30 am GMT, U.K.’s consumer price index and PPI reports are due. For the CPI, it is expected to show that inflation eased to 2.2% from the previous month’s 2.5%. As for the PPI, it is slated to report that input prices remained flat while output prices rose 0.3%.
Also watch out for the BOE’s inflation letter to be possibly released. If the CPI comes in higher than 3.0% or below 1.0%, Mervyn King will have to explain to the U.K. parliamentary what happened and what is being done to fix the situation.
Bad data? Eh, that ain’t a problem for the pound! Well, at least, it wasn’t in yesterday’s trading. Risk appetite allowed the pound to trade higher against its lower-yielding counterparts. GBP/USD finished the New York session at 1.6116 after opening the day at 1.6071.
Rumors that Spain is getting closer to asking for a bailout boosted market sentiment and encouraged investors to seek riskier assets. Heck, it seemed like traders got too excited about the news that they just shrugged off the disappointing inflation reports released by the U.K.
While the headline and core CPI figures for September came in just as expected at 2.2% and 2.1%, respectively, the PPI report printed below forecasts. The reading for the month tapped in at -0.2% and disappointed the market consensus which was for producer prices to have remained flat during the month.
Our forex calendar lists a few top-tier reports for today and I don’t think that it would be too easy for traders to ignore them. So don’t miss 'em later!
At 9:00 am GMT, the claimant count change report for September is eyed to show that the number of people who filed for unemployment benefits fell by 200.
Along with that, the minutes of the most recent BOE meeting will also be on tap. Back in September, the central bank left interest rates and the size of its asset purchases unchanged. Market participants will be closely looking at the report to see if the decision was unanimous or not.
Should the minutes reveal that more MPC members are pushing for more easing measures, we could see the pound trade lower. So keep tabs on it, ayt?
Risk appetite. These were the two words that propelled GBP/USD to a fresh 9-day high yesterday. The pair, which began the day at 1.6116, had risen as high as 1.6179 before it closed the U.S. trading session at 1.6147.
There were two main factors that contributed to risk appetite. The first one was Moody’s affirmation of Spain’s Baa3 credit rating with a negative outlook, allowing the country’s bonds to remain just a notch above “junk” status.
The second was positive economic data from the U.K. The Claimant Count Change, for instance, came in significantly better than forecast as it showed that the number of people who claimed for jobless insurance fell 4,000. The consensus was only for a decrease of 200. The unemployment rate report also shared the same story. It showed that joblessness fell to 7.9% from 8.1%.
In other news, the MPC Meeting Minutes revealed that while voted on unanimously, BOE policymakers were split at their October meeting over the need for further QE after the current program expires in November. I guess we’ll just have to wait and see for ourselves what the BOE actually does in its next meeting.
Only one major report is due for today. At 8:30 am GMT, U.K.’s retail sales report will be published. It’s projected to show that sales increased 0.4%, opposite the 0.2% decrease seen the month before. Rising retail sales is usually considered bullish for the domestic currency as it suggests that consumer spending is healthy.
Party’s over, boys! The pound broke its winning streak against its counterparts yesterday despite the release of strong retail numbers in the U.K. Cable plunged by a ridiculous 98 pips while GBP/JPY also fell by 33 pips. What gives?
The U.K.’s retail sales should’ve made the pound bulls giddy. The data showed a 0.6% gain in September, higher than the 0.1% downtick in August and analyst expectations of a 0.4% growth. Apparently, Britons got excited over clothes as clothing sales jumped by 2%.
Unfortunately, risk aversion reigned supreme during the U.S. session and erased the pound’s gains against its counterparts. Read all about what went down in the markets in my USD piece!
Only the public borrowing data is scheduled for release today at 8:30 am GMT. The data is expected to be weaker than its previous 12.4 billion GBP reading, so watch your charts closely for major inflection points that you can trade!
For the second straight day, the British pound was weighed down heavily by risk aversion. Against the safe haven U.S. dollar, the pound marked a 33-pip loss. Meanwhile, versus the low-yielding Japanese yen, the pound fell 23 pips.
The blow to risk sentiment came from the absence of concrete action with regards to a Spanish bailout in the EU summit. The only notable outcome of the EU summit was the agreement that the ECB would eventually be the chief banking supervisor in Europe. There was also the news that Germany once again showed opposition to using the ESM to directly re-capitalize banks in Europe.
In other news, the Public Sector Net Borrowing report beat forecast and came in with only a 10.7 billion deficit. The market had initially expected an 11.9 billion GBP deficit.
The upcoming week will be a heavy one as two major events are scheduled to happen.
On Wednesday, BOE Governor Mervyn King will be speaking at the Chamber of Commerce. With the BOE’s asset purchase program scheduled to end in November, traders will be closely monitoring what King has to say with regards to future monetary policy.
On Thursday, the U.K.’s preliminary GDP reading will be published. It’s expected to show that the country expanded 0.6% in the third quarter of this year, opposite the 0.4% contraction (revised up from-0.7%) seen during the second quarter. A rising GDP is usually considered bullish for the domestic currency, as it means that the economy is healthy.
The pound’s price action was as mixed as a hotpot yesterday as the currency warriors traded on risk sentiment. Though Cable steadied at 1.6010, Guppy had shot up by more than 100 pips to 127.97. Meanwhile, EUR/GBP inched 24 pips higher at .8156. Talk about sending mixed signals!
The U.K. didn’t release any major data yesterday, so the pound bulls and bears paid attention to the improvement in risk appetite in the euro region. Apparently, traders are optimistic that the bailout odds will be in Spain’s favor after the regional elections last weekend.
The pound gained against the yen, thanks to a not-so-surprisingly weak trade deficit numbers from the Land of the Rising Sun.
Today at 8:30 am GMT the BBA mortgage approvals data will take center stage. The report is expected to improve from its numbers last month, but keep your eyes peeled for any surprises.
At 5:00 pm GMT BOE head honcho Mervyn King will also be under the spotlight as he delivers a speech. Watch this event closely for any signs of more QE down the road, aight?
Tough day at work for the pound! GBP/USD ended the day in the red as it closed at 1.5951, 58 pips down from its 1.6009 open price, while GBP/JPY dipped 5 pips below the 127.00 handle before closing at 127.33. Will today be any better for the pound?
The U.K. didn’t release any economic reports yesterday, leaving risk sentiment as the primary driver of price action for the pound pairs. Unfortunately for GBP/USD and GBP/JPY, risk was off yesterday as U.S. equities slid down with the S&P 500 index slipping by 1.4%.
Up ahead, only the CBI industrial orders report is set for release from the U.K. at 11:00 am GMT. The figure for October is slated to climb from -8 to -6, which would still reflect decreasing order volumes but at a slower pace. Bear in mind that a weaker than expected reading could trigger another pound selloff so y’all better stay on your toes during the actual release!
Not so fast, pound bears! The pound erased some of its intraweek losses against its counterparts yesterday when expectations strong U.K. data boosted motivated the currency bulls. Cable popped up by 80 pips while EUR/GBP plummeted by 82 pips. Booyah!
The CBI industrial orders expectations gave little encouragement for the pound bulls yesterday when it came in at -23, a 10-month low, when analysts were only expecting a reading of -6. Apparently, business owners were concerned about the country’s manufacturing activity as well as the political and economic conditions abroad.
Good thing that investors had their eyes on the GDP report scheduled today at 8:30 am GMT! With retail sales and trade numbers showing improvements lately, market geeks are expecting the U.K. to climb out of the recession today by showing positive growth for the first time in three quarters.
The services index is also due for release around the same time as the GDP report, but I have a feeling that market movers won’t pay attention to that. So get your trading plans ready and focus on the U.K. GDP report, kids!
Bravo, old chap! The pound was the king of the currency hill yesterday, as it soared up the charts! GBP/USD rose 101 pips to finish at 1.6131, while GBP/JPY finished a ridiculous 159 pips higher at 129.56.
Now that’s how you end a recession with a bang! For the first time in a year, the U.K. economy posted positive GDP growth, as it grew an impressive 1.0% during the third quarter. Not only did it end the losing streak, but it also came in much better than the anticipated 0.6% increase.
Apparently, the Olympics, a slew of holidays, and a major improvement in the services sector all played a key role in lifting up the U.K. economy. The only question is, can the economy continue this performance in the fourth quarter?
No data lined up from our economic calendar today, so chances are we’ll see risk sentiment drive the markets today. Good luck trading today fellas!
Talk about letting a rally fizzle! The pound was unable to extend its gains for a third straight day as it ended the week on a low note. After trading below its opening price for almost the entire day, Cable settled 38 pips lower at 1.6093.
Looks like traders finally got their fill pounds because by Friday, demand for the pound had died down! It’s possible that many had taken profit on their positions, considering that the pound had gained so many pips in the previous two days.
Today, we only have the net lending to individuals report on tap, and it’s said that it will print a 0.6 billion GBP increase to undo August’s 0.4% decline. Though this report isn’t historically known as a major market mover, it could provide us with valuable insight on the state of the U.K. credit market.
Later in the week, the manufacturing PMI will be available. Forecasts say that the manufacturing industry probably contracted once again. The index is expected to slide from 48.4 to 48.1 and will be available on Thursday.
To cap off our week, we’ll take a look at the construction PMI, which is slated to tick down from a reading of 49.5 to 49.1. Catch the report when it comes out on Friday.
That is NOT how you wanna start off the week! The pound continued its misery from Friday, as it dropped another 81 pips versus the dollar, leaving GBP/USD to finish the day at 1.6033. Will the pound’s troubles continue or will we see a small pullback today?
In terms of actual data, the U.K. actually received better-than-expected news as the net lending to individuals report showed that British banks actually lent out 1.7 billion GBP last September. Not only was this nearly triple the expected increase of 600 million GBP, but it also marked the highest level in 4 years. This means that there’s more liquidity that’s hitting bottom-line consumers, which should translate to more spending and investing.
However, the pound still took a hit thanks to uber-cautious comments by BOE Deputy Governor Bean (no, not that Mr. Bean!). According to Bean, while there are reasons to remain optimistic, the economy is still in a bumpy ride and there’s a good chance that Q4 GDP growth will disappoint. His dovishness on the economy weighed down on the pound, causing the bears to take over.
For today, we’ve got the CBI realized sales report clocking in at 11:00 am GMT. The index is projected to print a reading of 7, marking a slight improvement from last month’s score of 6. If it comes in much higher than that, it could give the bulls enough fuel to make a comeback today.
The pound may have had its way with the dollar, but it could only salvage a draw against the yen. After a full day of trading, GBP/USD ended 45 pips higher at 1.6077 while GBP/JPY finished virtually unchanged at 127.99.
Although the CBI realized sales report revealed a huge upside surprise, market players weren’t really moved by its results and price action on pound pairs were hardly affected. The index printed a reading of 30, which is over 4 times the expected reading. Not only did October’s stats far exceed expectations, but it also marks the fastest rate of growth since June. The best part is that retailers believe they’ll see the same kind of robust growth next month!
Now on to more somber news - the GfK consumer confidence report. The index, which was published just a few hours ago, printed a reading of -30, which is slightly lower than the -28 reading that many were expecting to see. This comes as terrible news considering the U.K. just crawled out of recession. It makes me wonder if the U.K. can maintain its current rate of growth with consumer confidence on the way down.
No more reports from the U.K. today. In the meantime, I suggest y’all keep tabs on risk sentiment!
For the second straight day yesterday, Cable was able to trade positively. The pair, which opened the day at 1.6077, consolidated for the most part of the Asian session and then surged higher during the European and U.S. trading session.
There wasn’t much in terms of data yesterday as only the Gfk Consumer Confidence survey for October was released. It published a reading of -30, which was slightly higher than both forecast and the previous period’s reading. It was also at its lowest reading in 6 months.
According to the details of the survey, while the Olympics was able to boost the country’s growth rate, people still became more worried about their financial situation over the next 12 months.
Today, two major reports will come out that could have a strong effect on Cable’s price action.
The first one, which will be published at 7:00 am GMT, is the Nationwide House Price Index. It’s projected to show that the selling price of new homes with mortgages back by Nationwide rose by 0.2%, opposite the 0.4% decline seen the month before. Rising house prices are normally seen as bullish for the domestic currency as it could attract investors in the housing sector.
The second report you should keep an eye out for is the Manufacturing PMI. It’s going to come out at 9:30 am GMT and it is expected to print a reading of 48.1. Last month, the reading was at 48.4. A reading below 50.0 means indicates that the manufacturing industry is contracting.
What a letdown! It looked as though GBP/USD was going to finish the day above 1.6150, but sellers dragged the pair back down in the New York session, forcing it to close at 1.6124, down 14 pips on the day.
The contraction in the U.K.'s manufacturing industry worsened last month, as evidenced by the decline in the manufacturing PMI. The index dropped sharply from 48.1 to 47.5, strengthening pressure on the BOE to whip out more QE to support the economy.
Today, we have the construction PMI on tap, and survey says that it could be just as disappointing. Experts believe that the index could slide from 49.5 to 49.1. If the report fails to meet forecasts, it could lead to another pound sell-off as traders price in the possibility of more stimulus from the BOE’s meeting next week.
Talk about a bloodbath! The pound took a beating on Friday, as risk aversion swept through the markets during the New York session. GBP/USD dropped 106 pips to finish at 1.6018, while GBP/JPY closed 42 pips lower at 128.83.
We actually saw a better-than-expected result from the construction PMI, which rose from 49.5 to 50.9. It was projected to come in at just 49.1.
The problem though, was that we saw a strong sell-off after the release of the U.S. NFP report, allowing the scrilla to emerge victorious. Make sure y’all hit up my U.S. commentary for the 411 on the payrolls report!
For today, we’ve got the services PMI on tap at 9:30 am GMT. Expectations are that the report will print at 52.0, which would be a slight drop from last month’s reading of 52.2. If the reading comes in higher than anticipated, it could give the pound a nice boost to bounce back from Friday’s losses.
Look out below! The pound fell like a rock in yesterday’s trading following the release of worse-than-expected data from the U.K. GBP/USD fell from its intraday high of 1.6040 and hit a bottom at 1.5957 before closing the day 39 pips below its opening price at 1.5972.
The U.K. services PMI report for October printed lower at 50.6 than the 52.0 consensus and September’s 52.2 reading. Of course, the reading didn’t bode well for the pound as it indicates that conditions in the sector, which makes up over 70% of the British economy, aren’t looking good.
On top of that, the BRC retail sales monitor showed that consumer spending contracted by 0.1% in October after posting a 1.5% uptick the month prior.
Today the manufacturing production report for October will be on tap and chances are, it would probably affect the pound’s price action. Due at 9:30 am GMT, the report is expected to show that manufacturing activity picked up during the month with the consensus at 0.3%.
A better-than-expected figure could send the pound higher but a disappointing one could fuel its sell-off even more. Watch out for it, ayt?
With the markets focusing their attentions on the U.S. elections, we didn’t see much movement on GBP/USD yesterday. The pair traded within its average daily range and finished at 1.5994, just 22 pips above its opening price.
Even worse-than-expected manufacturing production data couldn’t give the bears enough mojo to send the pound to new lows. Manufacturing production growth clocked in at just 0.1% last month, which was below the 0.3% forecast. Furthermore, the previous month’s release was revised down to show a 1.2% decline.
Meanwhile, NIESR released its GDP estimate, projecting that the U.K. economy grew by 0.5% during the third quarter. While this is nice and dandy, it still doesn’t match up with the upwardly revised 1.0% growth we saw during the 2[SUP]nd[/SUP] quarter.
No data lined up today, but that doesn’t mean you can chill out. The Bank of England will be making its interest rate decision tomorrow and for all we know, traders may begin positioning themselves as early as today. Good luck trading, homies!