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September 2016

Markets turn to BoE on Thursday

Published: Monday 12 September 2016

  • Markets turn to BoE on Thursday 
  • Sterling down three consecutive days against the Euro
  • USD could rise on the back of Fed Brainard’s speech 
A quiet day looms as there is very little data of note due to be released. We do get to hear a raft of Federal Reserve policymakers before the blackout begins tomorrow. Late last week, markets were surprised as it was announced that the central banks most dovish member, Lael Brainard will be delivering a previously unannounced speech today. The news caught traders off guard as the Dollar gained as speculation mounts that the Fed is ready to continue to tighten policy. The Dollar has gained some ground and will continue its momentum if it is confirmed that Brainard has shifted her stance.
On Thursday the Bank of England meet again to discuss monetary policy. It is unlikely that there will be any change to their stance so soon after the last meeting but Sterling will take its cue from any new commentary from the Governor Carney at the resulting press conference. Sterling has continued to benefit from a short squeeze in positioning as the data has not shown as much of a post referendum slowdown as many analysts feared. It is worth noting that we have not yet left the EU and that the real test will be once article 50 has been triggered. Inflation and unemployment data on Tuesday and Wednesday will give us more of an insight into the economic landscape.
There is very little of note today ahead of Brainard’s speech this evening. Until then FX markets are likely to trade in current ranges. There may well be significant volatility after UK trading so please do discuss placing limit orders with your Halo Financial Consultant to take advantage of any spikes in exchange rates that may occur after hours.

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Today's Major Economic Releases 

Market BST Data/Event Previous Expected
GBP 14:30 UK: CB lending index m/m -0.3% -0.3%
USD 18:00 FOMC member Brainard speaks    
AUD 23:30 RBA Assist Gov Kent speaks    
NZD 23:45 New Zealand: FPI m/m -0.2% -0.2%

FX research by Ricky Nelson

Daily Currency Analysis by Zeta Webber

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