Daily Market Report 03/03/2014


Data from the Eurozone was fairly positive on Friday and as a result we saw the euro strengthen by 1% across the board.

Firstly, retail sales in Germany increased by 2.5% in January surpassing an expectation of a rise of only 1%. Despite worries of inflation dropping in the Eurozone, we saw a surprise pick up in the rate with inflation now at 0.8%. The Eurozone rate of unemployment also remained at 12%.


Data from the US on Friday was fairly mixed with economic growth in the fourth quarter only coming in at 2.4% instead of 2.5%. The Reuters Michigan consumer sentiment index came in higher than expected and pending home sales rose only by 0.1%.

Following all this data, the US dollar weakened ever so slightly across the board.


This morning we have seen demand for safe haven currencies such as the yen and Swiss franc intensify over the political tensions between Russian and Ukraine. Traditionally you would also expect the US dollar to strengthen as well given its safe haven status. However, it would appear uncertainty surrounding the Federal Reserve tapering their quantitative easing program are causing investors to hold off seeking the US dollar as a safe haven.

Manufacturing data from the Eurozone and the UK have come in better than expected this morning showing an expansion in both economies. The pound as a result has made minor gains in early trade.

Key Announcements:

13.58pm – USD – Markit Manufacturing PMI (Feb): Expected to expand to 56.6.

14.00pm – EUR – ECB President Draghi Speech.

15.00pm – USD – Construction Spending (Jan): Expected to fall by 0.5%.

15.00pm – USD – ISM Manufacturing PMI (Feb): Expected to increase to 52.