Morning Report: 15 March 2018

March 15, 2018

GBP Sterling was flat against USD yesterday and traded slightly higher against the euro, in an uneventful session overall. News headlines remain focussed on Theresa May’s response to the nerve agent attack on former spy Sergei Skripal, although so far this doesn’t seem to have had a strong impact on sterling. Today’s session is not brimming with promise, being barren of any major data releases.

EUR Yesterday the single currency weakened across the board after European Central Bank President Mario Draghi made some dovish remarks in the morning and euro never managed to regain momentum. Draghi signalled the ECB will be very patient with ending the Asset Purchasing Program, a blow in the face for hawks who hoped the recent strong Eurozone economy would justify an earlier exit. This morning the French Final Consumer Price Index has been published and showed no price changes in February. Meanwhile Eurozone car registrations remain on trend with a 4.3% year-over-year growth.

USD The greenback took advantage of yesterday’s euro weakness, but struggled elsewhere such as against JPY. TV host and former Bear Stearns economy Larry Kudlow was announced as the new Chief Economic Advisor to the White House. Kudlow was quick to appear on CNBC, where he was a contributor, to outline a number of views, including support for a strong dollar. US retail sales fell short of expectations in February, continuing their unwind from an unusually frenetic fourth quarter in 2017. Today at 13:30 GMT manufacturing survey indices will be released by the New York and Philadelphia Federal Reserves, alongside weekly Initial Jobless Claims and Import Prices. The NAHB Housing Market Index will be released at 14:00.

CAD The loonie performed mixed against the other major currencies yesterday on a day that saw little movement, whilst it remained flat versus USD. No Canadian data was released yesterday, but Crude Oil Inventories rose by 5.0M barrels, more than double the consensus forecast. This afternoon at 12:30 GMT the ADP Non-Farm Employment Change Estimate is released.

UK news

  • Reuters: Unilever picks Rotterdam headquarters over London in blow to UK before Brexit? Britain’s third biggest company Unilever (ULVR.L) (UNc.AS) will scrap its London corporate headquarters and make Rotterdam its sole legal home in a blow to Prime Minister Theresa May’s government almost one year to the day before Brexit. “This is not about Brexit,” Chief Executive Paul Polman said. “Unilever is in 190 countries in the world. Most of these countries are not in the European Union.”
  • Financial Times: US believes Russia responsible for nerve agent attack in Britain The US has blamed Russia for the attempted murder of double agent Sergei Skripal, saying it stands in “absolute solidarity” with Britain on the matter.
  • Financial Times: Democrat claims victory in too-close-to-call US Congress race A Democratic challenger claimed victory on Wednesday in a congressional election in a Pennsylvania district won by Donald Trump in the 2016 presidential race despite the official result being too close to call.

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