- German industrial production slips
- Oil up on hopes of production slowdown
- Fed Minutes the focus or probably a damp squib
Tuesday's trading was dominated by service sector indices and they were pretty mixed. The European versions were less positive than expected and that allowed the Euro to give up some of its gains but the UK and US releases were in good form and the Pound and US Dollar both benefited from that. However, we can't get too carried away, the dark cumulus nimbus of an EU membership vote is growing in height on the horizon and that will continue to dampen the mood as far as the Pound is concerned.
Oil prices rose in early Asian trade as traders started to believe a deal will be struck later this month to cap production and reduce the massive over-supply that has caused a slump in prices. That plus and improvement in Chinese manufacturing activity, allowed share prices to ease to higher levels both in the Asian and early European trading sessions. A higher oil price tends to weaken the US Dollar, so don't be surprised if that plays out over the days ahead.
Other than the German industrial production data - which was worse than January’s data but not as bad as forecast - today is light on data. Most traders will be keeping their powder dry ahead of this afternoon's release of the Federal Reserve meeting minutes. Of course everyone is hoping for certainty over the path and pace of US interest rate hikes but; just as certainly, they won't get it. There was undoubtedly talk of rates and keeping them on hold but any definite dates for rate hikes will have been put aside pending further clarity on global growth and pending more comfort over the certainty of US growth.
And I would guess a lot of people would love to try the emergency slide on an aeroplane; not in an emergency of course - but just because it might be fun. Well one employee of United Airlines in America got fed up of waiting for the ramp to be deployed when the plane touched down during an internal flight. So she opened one of the front doors, deployed the slide and scooted down it before walking away from the plane with its 159 passengers on board. She has been suspended from flying pending enquiries but...well it must have been fun mustn't it.
Two sales executives are called into the boss's office. They take seats across from the boss's desk and sit there a little nervously.
"Well done you two," says the boss. "Your efforts have boosted turnover by 25% and increased the bottom line profit by 18% over the last year. I am delighted and would like to reward you for your hard work. “He stood there and leans over the desk, placing an envelope in front of each of them.
He sits back down and says, "You don't need to open them now but in each of those envelopes is a cheque for £10,000."
The two salesmen start grinning from ear to ear and high five each other.
"And," says the boss, "if you carry on with that same commitment and work ethic over the next 12 months......," he paused for dramatic effect and the salesmen were on the edge of their seats in anticipation, "well, as I say, with a another 12 months of that same effort and hard work...well....I'll even sign those cheques."
Today's Major Economic Releases
FX Research by David Johnson
||EU: Retail PMI
||Canada: Ivey PMI, index
||US: Crude oil inventories
||US: FOMC meeting minutes
Daily Currency Analysis with Chris Verdet