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April 2016

Canadian wholesale trade slumps

Published: Thursday 21 April 2016

  • Canadian wholesale trade slumps
  • Sterling bounces
  • ECB awaited
It was so sad to hear of Victoria Wood's death at such an indecently early age. Her particularly British humour was sublime and she set the standard for other script writers and comedians at such a high level. One of my favourite lines of hers was "I once went to one of those parties where everyone throws their car keys into the middle of the room. I don’t know who got my moped but I've been driving that Peugeot for years." Love it and loved her.
In the financial world, things are still very unsettled. The Pound gained ground against most other currencies yesterday in spite of a slight rise in the number of unemployment benefit claimants.  Perhaps traders are just bored with selling the Pound and perhaps there is an element of profit taking. Or maybe traders are starting to believe that the UK public will 'bottle it' when it comes to the EU exit vote and this will prove to have been a lot of hot air about nothing. Whatever the reason, Sterling is up...a bit.
Canadian data showed a sharp drop in wholesale trade. Sales were down by 2.2% in February; a much sharper decline than the 0.3% most had expected. This has had an impact on economic growth forecasts and yet traders decided to buy the Canadian Dollar. That probably has more to do with the volatility in oil markets than anything else. However, with a Bank of Canada that sounds very dovish and the Canadian GDP data due for release next week, there is plenty of scope for a bounce in the Sterling – Canadian Dollar rate.
Thursday's big news includes the European Central Bank's announcement that nothing has changed on interest rates. They may add a tweak or two to their bond buying program but that too is unlikely. We will also get UK retail sales and government borrowing data. The numbers are expected to be mixed on these so beware of the Pound giving up some of the gains of the last 48 hours. This afternoon's data is pretty limited, so let's not get too excited about volatility in later trade.
In other news, it was a delight to see the Queen and her three heirs to the throne posing for a picture to mark her 90th Birthday. The sight of Prince George standing on books to get his height right and grinning for the camera was very sweet. I am sure his Great Grandma was very happy with that shot. Happy Birthday Ma'am.

In the cold cold north

An Air Force cargo plane was preparing for departure from Thule Air Base in Greenland. They were waiting for the truck to arrive to pump out the aircraft's sewage holding tank.
The Aircraft Commander was in a hurry and getting impatient. The truck was late in arriving and the Airman performing the job was extremely slow in getting the tank pumped out.
The Commander shouted from the cockpit window at the Airman, berating him for his slowness and promising to dish out punishment if he didn't get a move on.
The Airman responded, "Sir, I have no stripes, it is 20 below zero, I'm stationed in Greenland, and I am pumping excrement out of aircraft which are all then heading to warmer climate. Just what is it that you think you can do to punish me?"

Today's Major Economic Releases

Market BST Data/Event Previous Expected
GBP 09:30 UK: Retail sales, % m/m (y/y) -0.4 -1.3
EUR 12:45 E19: Interest rate announcement, % 0.00 0.00
EUR 13:30 E19: ECB Press conference    
USD 13:30 US: Initial jobless claims, k (4wma) 253 260
USD 13:30 US: Philadelphia Fed mfg index -12.4 10.0
EUR 15:00 E19: 'Flash' consumer, index -9.7 -9.4

Daily Currency Insight and David Johnson

Daily Currency Analysis with Chris Verdet

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