Forex trading headlines from the European session 26 September
- UK final Q2 GDP q/q +0.7% as exp/prev. y/y revised down to 1.3% from 1.5%
- UK Q2 current account GBP -13 bln vs -12 bln exp. prev revised down to 21.77 bln
- Japan’s GPIF says other public funds should diversify into different assest classes
- Italy back in focus as Berlusconi threats take hold again. President cancels a public appearance
- US Fed’s Lacker sees only a minimal impact of govt funding issues on GDP
- Lacker says US growth to remain around 2%
- PBOC to steadily push forward interest rate reforms. announces launch of CD market
- ECB’s Asmussen convinced that US will resolve debt ceiling problems
- ECB’s Asmussen says Germany under-investing domestically
- ECB’s Liikanen says too-big banks may be burden on growth
- Syria: Russia says it will help guard Syria’s chemical weapons
- IMF more confident of their 2013 7.7% growth forecast for China
- Eurozone M3 annual growth august +2.3% vs +2.2% exp/prev
- French consumer sentiment sept +85 as exp vs +84 prev
- Former ECB president Trichet says Germany should lower its c/a surplus
- Italian retail sales july m/m sa -0.3% vs -0.2% prev
- Nikkei closes up 1.22% at 14,799.12
- Shanghai comp index closes down 1.94% at 2155.81
A strange ol’ morning with some dodgy data and tons of rhetoric to add to already jittery markets.
The pound was the first to feel the force when hit with a double-whammy of lower revision UK Q2 y/y GDP and horrible Q2/Q1 c/a data. Cable had earlier had a solid run higher but was baulking ahead of strong sell interest at 1.6100 but then, as if by magic ( again! ) we fell 20 pips just before the data release.Anyone would think someone got the info ahead of schedule ( again!). GBPUSD fell further to 1.6038 but has since bounced and sits at 1.6057 as I type.
EURGBP had a look below 0.8400 but then jumped to 0.8422 after the UK data and then fell back to 0.8400 soon after as wires reported the Italian president cancelling his diary today in the wake of more political unrest regarding Bunga-bunga Boy. Cue euro weakness across the board with EURUSD falling below 1.3490 having spent most the time prior sitting around 1.3525. We’ve rallied a little since but still looking wobbly.
And not to be left out we had the yen make a bid for the spotlight as the GPIF failed to directly specify yen diversification in an interim report as had been rumoured and seen the yen weaken off rapidly in Asia. USDJPY fell to 98.60 from 99.02 dragging yen pairs lower with it ,exacerbated by the already weakening euro and pound, EURJPY dropping to 132.89 in a rush before bouncing.
The aussie $ had a decent morning but AUDUSD failed to hang on to gains over 0.9400, with a similar story on the kiwi.
So a lively morning again but we’re really none the wiser for it. Expect more of the same for the foreseeable future.
But where there’s uncertainty, there’s also opportunity.