- German HICP (Final): y/y at -0.7% vs -0.8% previous; m/m at 0.1% vs. -0.1% previous
- French HICP m/m inline with -0.3% forecast; y/y inline with 0.6% forecast/previous
- U.K. Claimant Count Change at -33.6K, better than -30K forecast, but worse than -39.5K previous
- U.K. Unemployment Rate ticks lower as expected to 6.4% vs. 6.5% previous
- European Industrial Production m/m comes in weaker-than-expected: -0.3% vs. 0.4% forecast, -1.1% previous
- Swiss ZEW Survey comes in much higher at 2.5 than 0.1 previous
The morning London session was heavily stacked with economic data from Europe and the U.K., providing much need volatility for forex traders to feast on.
The big focus was the British Pound, seeing a spike in action thanks to improving unemployment data, but more on BOE Governor Carney’s commentary in the BOE inflation report. The highlight for traders from the report was the rhetoric that wage slack is still the focus, with the outlook for growth not so rosy at the moment.
This once again pushes back expectations of a rate hike by the BOE, which Carney also commented on by setting expectations they will be gradual and limited. Sterling took a big hit on the session after the data, bringing it down big time against the Greenback and the Comdolls:
GBP/USD is down 90 pips (-0.54%) to 1.6718, GBP/AUD is down 186 pips (-1.04%), and GBP/NZD is down 193 pips (-0.96%) to 1.9733
The forex calendar for the afternoon U.K. morning/U.S. session is much lighter than what we saw in Europe, starting with the just released U.S. Retail Sales data. Both the core read (ex. Auto) and headline number came out below expectations and previous reads at 0.1% and 0.0% respectively. The initial reaction in the Greenback has been negative so far, but it’s still fresh so be cautious when trading the U.S. Dollar.
At 3:00 pm GMT, we’ll get U.S. inventories data for another read on the business sector. The forecast is for a tick lower to 0.4% vs. 0.5% previous, and since this is a mid-tier event, don’t expect too much volatility unless we see a large surprise from the actual read.
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