Good morning

High Low High Low
EUR/USD 1.1351 1.1326 USD/ZAR 13.5430 13.4560
GBP/USD 1.5437 1.5410 GBP/ZAR 20.89 20.76
EUR/GBP 0.7359 0.7342 USD/RUB 65.17 61.68
GBP/EUR 1.3620 1.3589 USD/ILS 3.8829 3.8558
USD/JPY 119.97 119.61 S&P 500 2024 2014
GBP/CHF 1.4814 1.4783 Oil (Brent) 48.36 47.92
GBP/AUD 2.1480 2.1314 Gold 1168.0 1164.0

The main event of the day is the ECB meeting later today (not change in rates expected) followed by Draghi’s conference where there are calls for the ECB’s QE programme to be extended past the current Sept 2016 end date. There is no doubt that further assistance is needed and such a decision will cement the ECB efforts to strengthen the EU and avoid any further shocks to the system. The EUR(USD) could be slightly affected by such a decision but overall the currency remains firmly entrenched in the range of the past few months. Truth is all eyes are on next week’s FED/FOMC meeting though again no change in rates in expected though it will be interesting to see what Ms. Yellen has to say following the rate decision announcement. Overall the USD remains range bound vs the majors.

Today also sees the publication of UK Retail Sales (9.30am). Last print saw an increase of 0.20% with Economists polled predicting better results this time round at +0.30%.  On a separate note, BoE Governor Carney spoke yesterday and reinforced what we know already that the UK economy grew fastest and strongest amongst comparable Western Economies. The Gov. said membership of the EU had helped to lift UK growth and living standards, while enhancing Britain’s flexible jobs market and “dynamism”. Mr Carney said the UK had been the “leading beneficiary” in many ways of the “Four Freedoms” of the movement of goods, services, people and capital across borders, adding that Britain should seek a “principled” and “upfront” guarantee from the eurozone that the EU is a multi-currency zone.

Overall I think EURUSD and GBPUSD will continue to trade sideways (in the range) awaiting fresh news. As I have previously said I think my prediction at the beginning of this year for the EUR(USD) to trade at PARITY is not going to happen. We got close 1.0450’s but unfortunately it was not meant to be. The strong USD has indeed had a material impact on US corporates and US data as a whole so it would not surprise me if the FED/ECB/BoE had a “hand” in slowing down the USD rally.


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