London Session Recap – March 13, 2014

  • French inflation comes in mixed. HICP y/y up 1.1% vs. 1.0% forecast, 0.8% previous; CPI y/y lower-than-expectations 0.9% vs. 1.0%, higher-than-previous 0.7%

The morning London session was light on economic data, with French inflation data being the only market catalyst. Without major economic events or surprise news reports, volatility was much calmer than during the Asia session.

Despite the lack of major catalysts in the morning, we are seeing the British pound move higher across the board.  There isn’t a clear catalyst at the moment, so it could be traders lightening up on short positions since Sterling has been battered over the last 4 sessions. GBP/USD is up 82 pips (+0.5%) to 1.6697, GBP/JPY is up 60 pips (+0.61%) to 171.34, and EUR/GBP is down 7 pips (-0.09%) to .8355.

And as expected after positive news from both New Zealand and Australia today, the comdolls are holding their gains into the U.S. session open, with the Aussie being the biggest gainer of the day: AUD/USD is up 70 pips (+0.79%) to .9056, AUD/JPY is up 62 pips (+0.67%) to 92.95, and AUD/NZD is up 42 pips (+0.40%) to 1.0578.

The forex calendar is pretty full to close out the Thursday session with economic data points from both the U.S. and Canada.

From Canada, we’ve got Capacity Utilization data and the House Price index at 12:30 pm GMT.  Expectations are for both to come near inline with previous reads, plus these two aren’t usually market movers unless we get a wide surprise in the actual number.

From the U.S, we’ve got initial claims, import price index and retail sales at 12:30 am GMT.  Retail sales is usually the market mover, so be on the look out for volatility to rise around this time.  Headline expectations are for a 0.2% increase vs. -0.4% in the previous read.

At 2:00 pm GMT, U.S. business inventories will be released with a forecast of 0.4% vs. 0.5% previous read. Finally, at 6:00 pm GMT, we’ll get the Federal budget balance report, with expectations of spending deficit around -$195B vs. -$10.4B previously.

Lots of potential catalysts today…Stay frosty!

See also:

Asian Session Recap

U.S. Session Recap

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