Daily Brief

Daily Brief

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Going nowhere

USD

Give or take 0.2% - call it a quarter of a cent - the USD was unchanged on Friday  during the London and New York sessions against the EUR, CHF, JPY, CAD, GBP, NOK and SEK. That is an unusually long list of non-movers.  There has been a little more activity in Europe this morning but the USD remains flat against the euro compared with its level at the same time on Friday.  The two US economic statistics which mattered were Michigan university's sentiment index - it was downwardly revised to 98.6 - and third quarter gross domestic product.  GDP grew by a provisional annualized 3.5% in Q3, a little more than the forecast 3.3% but well off the 4.2% expansion achieved in Q2.  Having strengthened ahead of the announcement, the USD gave back all of its gains afterwards.

EUR

In a day devoid of Euroland economic data investors made what they could of political developments and central bankers' speeches. The former were in short supply. Among the latter it was ECB president Mario Draghi who attracted attention. In a speech entitled "The evolution of central bank independence" he criticised political leader who try to exert pressure on monetary policy-setters. Sig. Draghi did not name names but his targets were obviously Italy's prime minister and America's president. His speech did not move the EUR but it provided welcome entertainment during the idle hours.

CAD

Losses on Friday and gains early today left the USD 0.4% lower against the CAD.  The Loonie touched a six-week low along the way before rebounding towards its average price over the last week.  There were no  domestic ecostats or significant political statements to affect the CAD.

GBP

UK domestic data were a no-show on Friday too. The GBP lost half a cent ahead of New York's opening before winning it back and coning to a halt.  Sterling was unchanged against the USD on the day. Data this morning, which showed UK mortgage approvals slowing in September but beating forecast, did nothing to the GBP. The same might or might not be true of the government's Budget announcement this morning. Chancellor of the Exchequer Philip Hammond said on TV Sunday that today's Budget would have to be scrapped if Britain leaves the EU with no deal. Investors will therefore probably take whatever he says with a grain of salt. 

JPY  

At least Japan came up with some domestic economic data. Figures released overnight put September's retail sales 0.2% below those for August which compared with the same month last year they were up by 2.1%. Investors were happy enough with the data but were not enticed to buy or sell the yen, which seems to be locked into its dance with US equity prices; falling share prices mean a rising JPY. There was no neat movement on Friday though, leaving the JPY and USD unchanged against one another.

USD buyers not motivated by GDP and confidence data

USD buyers not motivated by GDP and confidence data

EUR in holding pattern as ECB chief scolds political interference

EUR in holding pattern as ECB chief scolds political interference

CAD firmer despite lack of statistical input

CAD firmer despite lack of statistical input

GBP girding its loins for Budget speech this morning

GBP girding its loins for Budget speech this morning

JPY flat as equity price moves cancel out

JPY flat as equity price moves cancel out

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