Forex - European Highlights - 09 September 2019

 10:26 (GMT) 09 Sep

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European Highlights

European Highlights - 09 September 2019 (0101-PBST-C01)

09 September 2019

Asia FX and News

+ UD/USD and NZD/USD dipped on the open following soft China trade data from the weekend as exports unexpectedly contracts, but subsequently recovered with China stimulus speculations in the background. While China's trade balance with the US shrinks, China had yet another larger trade deficit with Australia. AUD was also given a lift on a huge beat on home loans. USD/JPY flat below 107. GBP remains soft from Friday as PM Johnson insist on his Brexit strategy.

Nikkei and JGBs -

Nikkei +0.56%, 10Y JGB at -0.258%

Europe FX and news

+ GBP weakened at the open in Europe but recovered strongly through the morning, helped by better than expected GDP data for July. The USD was generally weaker, losing ground against most risk sensitive currencies, while gaining a touch against the JPY in more risk positive markets.

+ UK GDP rose 0.3% in July, well above market expectations for a 0.1% rise, with all sectors showing m/m rises, though the 0.3% m/m gain in services was primarily responsible for the strength as much the largest sector. The July rise makes a Q2/Q3 recession very unlikely if it is left unrevised. The July goods trade deficit was slightly smaller than expected at 9.14bn.

+ German trade data showed a larger than expected surplus of EUR20.2bn in July, helped both by a rise in exports and a decline in imports.

+ Norwegian GDP was stronger than expected in July, rising 1.0% m/m on both total and mainland measures.

+ Eurozone Sentix investor confidence recovered slightly in September after matching 2014 lows in August.

+ UK PM Johnson visiting Ireland expressed optimism that a Brexit deal can be done, but Irish PM Varadkar said that no backstop mean no deal for them.

Bonds and equities

European bonds reverse a good chunk of Fri's covering rallies, reverting to steepening with DE30s +6bp and FR30s +7bp, OATs back to heavy after the recent large issuance. Periphery also give some ground in tandem. Gilts likewise mainly unwinding Fri action, with Brexit news and higher GDP not really contributing over the morning. USTs also weaker in range at long end


JP: Bank Lending Data (Ex trusts) (Aug) 2.2% y/y (Prev: 2.5)

JP: GDP (sa) (Q2 F) 0.3% q/q (Mkt: 0.3 Prev: 0.4)

JP: Economy Watchers Survey (Aug) 39.7 (Prev: 44.3)

AU: Housing Finance (Jul) 4.2% m/m (Prev: 0.4)

NL: Manufacturing Production (Jul) 0.5% m/m (Prev: -0.8)

NL: Manufacturing Production (Jul) -0.2% y/y (Prev: -2.2)

CH: Unemployment (sa) (Aug) % (Mkt: 2.3 Prev: 2.3)

DE: Trade Balance (Jul) EUR bn (Prev: 16.8)

DE: Current Account (nsa) (Jul) EUR bn (Prev: 20.6)

NO: GDP (Jul) % m/m (Prev: -0.2)

FR: BoF Business Sentiment (Aug) (Mkt: 96 Prev: 95)

EU: Sentix Investor Confidence (Sep) (Prev: -13.7)

UK: Index of Services (Jul) % 3m/3m (Mkt: 0.1 Prev: 0.1)

UK: GDP (Jul) % m/m (Mkt: 0.1 Prev: 0)

UK: Construction Output (sa) (Jul) % m/m (Mkt: 0.2 Prev: -0.7)

UK: Index of Services (Jul) % m/m (Mkt: 0.1 Prev: 0)

UK: Industrial Production (Jul) % m/m (Mkt: -0.1 Prev: -0.1)

UK: Manufacturing Production (Jul) % m/m (Mkt: -0.2 Prev: -0.2)

UK: Construction Output (sa) (Jul) % y/y (Mkt: 0 Prev: -0.2)

UK: Industrial Production (Jul) % y/y (Mkt: -1.1 Prev: -0.6)

UK: Manufacturing Production (Jul) % y/y (Mkt: -1.1 Prev: -1.4)

UK: Trade Balance (Non-EU) (Jul) GBP bn (Mkt: -3 Prev: -0.186)

UK: Visible Trade Balance (Jul) GBP bn (Mkt: -9.8 Prev: -7.009)

Still to be released

19:00 GMT - US: Consumer Credit (Jul) USD bn (Prev: 14.596)

23:50 GMT - JP: M2 Money Supply (Aug) % y/y (Prev: 2.4)

Events and Auctions

00:00 GMT - UK: Lawmaker's vote on early General Election

03:30 GMT - JP: 6mth Bills Auction

06:00 GMT - JP: Enhanced Liquidity Auction

09:00 GMT - UK: BoE's Vlieghe speaks in London

09:30 GMT - DE: Bills Auction (EUR 2bln)

15:30 GMT - US: 3mth Bills Auction (USD 45bln)

15:30 GMT - US: 6mth Bills Auction (USD 45bln)

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