Yesterday’s market movers
- Yesterday morning in the UK, the Halifax House Price Index was published, coming out higher at 1.2% from 0.4%. This didn’t have a major impact on cable but Euro dropped against sterling shortly after this was released.
- The European GDP and German factory orders were expected at 10am. GDP came out flat as forecast at 2.5% YoY and German factory orders were higher than expectations and from previous orders increasing to 23% YoY. However, this information didn’t really impact the market with concerns about Portugal being the main issue of the day for Euro.
- Later in the day, we had the ISM non manufacturing for June for the US. Coming out lower than expectations and than previous, it brought more aversion to risk in a market already quite weary after Moody’s reduced Portugal’s rating to junk. As a result, USD strengthened quite a bit against GBP with cable falling to a low of 1.5948.
Today’s market movers
- Today’s main information should be the interest rate decision from the BoE and ECB. No changes are expected from BOE but we should see a new interest hike from the ECB bringing rates for the Euro zone from 1.25% to 1.5%. This decision should logically be bullish for the Euro and EUR/USD could come back on yesterday’s losses.
- In the UK, industrial and manufacturing production should come out at 8.30 am. YoY, Industrial production is expected to increase and manufacturing to decrease. Overall those figures shouldn’t have a major impact as most investors will be waiting for the rate decisions.
- In the USA, Initial and continuing jobless claims as well as ADP employment change are expected in the afternoon. All figures are expected better with ADP expected twice as high as last month’s figures. This could help stem the flow of risk aversion being caused by the ongoing problems in the EU at the moment.