Morning Report: 4 April 2018

April 4, 2018

GBP Most of the action was in equity markets yesterday, with sterling trading only marginally up vs USD and EUR. Overnight the British Retail Consortium’s Shop Price Index was released, and showed reported prices falling by 1%, the biggest fall since February of last year, as food prices weighed down the index as a whole. At 09:30 BST the Construction Purchasing Managers’ Index will be released.

USD The dollar has been range bound against the euro recently, and after some losses in the morning began to strengthen again. The Trump administration detailed its plans for tariffs on a variety of Chinese imports, representing an annual import value of $50bn and putting trade policy once again back in the spotlight, as retaliatory measures have already been announced. Today’s data calendar is more lively than yesterday, with the ADP estimate of Non-Farm Payroll growth released at 13:15 BST, followed at 14:45 by the Markit Services Purchasing Managers Index. At 15:00 the equivalent ISM index will follow, accompanied by Factory Orders.

EUR Euro had to stomach losses against most major currencies yesterday and only managed to stay in the green against haven currencies like JPY and CHF. German February Retail Sales fell unexpectedly by 0.7%, for the second month in a row, disappointing hopes of a rebound after a weak print in January. Today at 10:00 GMT February’s Unemployment Rate and March’s Consumer Price Index will be released.

CAD The loonie experienced a marvellous day and was the strongest performer of the major currencies against USD. Its gains were pronounced against JPY and CHF. Positive sentiments around the NAFTA negotiations boosted CAD after the Mexican Minister of Finance said he sees in the near future.

UK news

  • REUTERS: China announces additional tariffs on $50 billion of U.S. goods. China will impose additional tariffs of 25 percent on 106 U.S. goods including soybeans, autos, chemicals, some types of aircraft and corn products, among other agricultural goods, the finance ministry said on Wednesday.
  • REUTERS: Russian spy chief blames U.S., British agencies for Skripal poisoning. Russia’s foreign intelligence agency chief Sergei Naryshkin said on Wednesday that the poisoning of former double agent Sergei Skripal in Britain was an act of provocation by U.S. and British intelligence services.

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