London Session Recap – Sept. 29, 2014

  • U.K. M4 Money Supply m/m: 0.3% vs. 0.2% previous
  • U.K. Net Consumer Credit: 0.9B GBP vs. 0.8B GBP forecast, 1.1B GBP previous
  • U.K. Mortgage Approvals: 64.2K vs. 65K forecast, 66.8K previous
  • European Consumer Sentiment stays inline with forecast/previous at -11.4
  • European Economic Sentiment dips: 99.9 vs. 100.6 previous
  • European Industrial Sentiment improves: -5.5 vs. -5.8 forecast, -5.3 previous
  • German CPI m/m better-than-expected: 0.0% vs. -0.1% forecast, 0.0% previous

The euro saw mixed price action this morning (but mostly higher) thanks to mixed sentiment survey data on various parts of the economy, and despite the lack of pick up with inflation in Germany.  Euro pairs are up on the session and look to be picking up steam going into U.S. trade:

EUR/USD is up 21 pips (+0.17%) to 1.2701, EUR/JPY is up 41 pips (+0.30%) to 138.98, and EUR/GBP is up 21 pips (+0.27%) to .7826

The forex volatility isn’t that big, but the British Pound isn’t fairing too well after broad financial market reads disappointed forex traders. The price action is mixed but the best reflection of today’s weak data seems to be coming from GBP/CHF, down 23 pips (-0.15%) to 1.5419 and still falling.

Finally, the other currency move of note is the New Zealand Dollar, which had a huge drop off after it was reported during the Asia session that there was another secret intervention by the RBNZ, selling 521M NZD in August.  Forex traders actually calmed down during European trade, but the Kiwi is something to watch as U.S. traders get to price in the news.  For now, NZD/USD has pulled back higher to .7770 after getting down as low as .7706 during the Asia session.

We’ll get a blast of mid-tier data from the U.S. economic calendar for the first afternoon London/morning U.S. session of the week.

At 1:30 pm GMT, we’ll see a healthy mix of consumer reads including personal spending and income, as well as a read on U.S. inflation in the form of the core PCE Price Index. All data points are forecasted to come in above previous reads, which would be a good change of pace for the Greenback since they have been trending to the downside in recent months.

At 3:00 pm GMT, we’ll get the latest pending home sales data for a fresh read on the housing sector in the U.S.  This data point has be pretty volatile for the last few months, including this upcoming release which is forecasted to come in negative at -0.5% vs. a very nice 3.3% pop in the previous month.

Finally, geopolitical news has weighed on broad risk sentiment, with the latest coming from pro-democracy protests in Hong Kong.  Broad equity markets have been mostly on the downswing, which means we may see capital flows into safe haven currencies like the Japanese yen and Swiss franc…Stay frosty!

See also:

Asia Session Recap

U.S. Session Recap

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