Forex - European Highlights - 10 September 2019


 10:11 (GMT) 10 Sep

  [Forex Highlights]

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European Highlights

10 September 2019

Asia FX and News

+ China Aug. Consumer Prices +2.8% Y/y; Est. +2.7%

+ AUD slips on weaker business sentiment data, with Chinese stock indices relatively soft. Losses more pronounced against the Kiwi, which was underpinned by higher retail card spending though heavy traffic index fell in Aug. AUD/JPY briefly looked above the 50dma before Aussie data sent the pair back to flat.

+ USD/JPY rose to as high as 107.50 after clearing the 50dma around 107.25 on no obvious triggers, without support from US yields and equities. PM Johnson's request for an early election was voted down by MPs for a second time as widely expected, hence no reaction seen on GBP. Johnson reiterated that he will not delay Brexit. Parliament has been suspended until October 14 as planned.

Nikkei and JGBs -

Nikkei +0.35%, JGB 10yr yield at -0.223%

Europe FX and News

+ The USD was net little changed through the European morning, initially falling back against the European currencies but USD firm in Asia then rebounding strongly, while USD/JPY edged a touch lower after overnight gains.

+ Much of the volatility was due to GBP, which led the movs in EUR/USD. The causes of early volatility were unclear, but the stronger than expected earnings data provided support later in the session.

+ SEK and NOK both weakened after softer than expected CPI data reversing recent gains.

+ UK average earnings rose 4% y/.y including bonuses in the 3 months to July, the largest rise since 2010. But other aspects of the data were less strong, with employment growth slowing and vacancies weakening.

+ Swedish CPIF rose 1.3% y/y in August, below the 1.5% expected, while Norwegian core CPI rose 2.1% y/y, below the 2.2% expected.

+ French industrial production was slightly weaker than expected, rising 0.3% in July. Italian production was also weaker, falling 0.7% m/m.

Bonds and equities

Early flurry on a stop-run to see 30yr bunds yields test positive, before things settle down. Gilts capped by firmer earnings, though still flat to slightly firmer. BTPs outperform wider periphery slightly after passing Lower House confidence vote in new government, Senate vote still to come.

Data:

JP: M2 Money Supply (Aug) 2.4% y/y (Prev: 2.4)

AU: NAB Business Conditions (Aug) 1 (Prev: 2)

AU: NAB Business Confidence (Sep) 1 (Prev: 4)

NO: CPI Core (Aug) 4cast: 2.2% y/y (Prev: 2.2)

NO: CPI (Aug) % m/m (Mkt: -0.4 Prev: 0.7)

NO: CPI Core (Aug) % m/m (Prev: 0.6)

NO: CPI (Aug) 4cast: 1.9% y/y (Mkt: 1.8 Prev: 1.9)

FR: Industrial Production (Jul) % m/m (Mkt: 0.5 Prev: -2.3)

FR: Industrial Production (Jul) % y/y (Mkt: 0.4 Prev: 0)

FR: Manufacturing Production (Jul) % m/m (Mkt: 0.8 Prev: -2.2)

FR: Manufacturing Production (Jul) % y/y (Mkt: 0.1 Prev: -0.6)

SE: CPI (Aug) 4cast: 1.6% y/y (Mkt: 1.7 Prev: 1.7)

SE: CPIF (Underlying) (Aug) 4cast: 1.5% y/y (Mkt: 1.8 Prev: 1.5)

IT: Industrial Production (sa) (Jul) % m/m (Mkt: -0.1 Prev: -0.2)

IT: Industrial Production (wda) (Jul) % y/y (Mkt: 0.3 Prev: -1.2)

UK: ILO Unemployment Rate (Jul) 4cast: 4% (Mkt: 3.9 Prev: 3.9)

UK: Average Earnings (incl. bonus) (Jul) 4cast: 3.7% 3m y/y (Mkt: 3.7 Prev: 3.7)

GR: HICP (Aug) % y/y (Prev: 0.4)

US: NFIB Small Business Optimism (Aug) (Mkt: 103.5 Prev: 104.7)

Still to be released

12:15 GMT - CA: Housing Starts (Aug) 4cast: 215k (Mkt: 212.5 Prev: 222)

12:30 GMT - CA: Building permits (Jul) % m/m (Mkt: 2 Prev: -3.7)

Events and Auctions

08:00 GMT - NL: Tap of DSL 0.25 7/15/29 (EUR 2bln)

09:30 GMT - BE: Bills Auction

09:30 GMT - EU: ECB Main Refinancing Operation Result

15:30 GMT - US: 52wk Bills Auction (USD 28bln)

17:00 GMT - US: 3yr Notes Auction (USD 38bln)


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