Forex news from the European session 13 Oct
News:
- BOE's Vlieghe says household consumption may be more sensitive to rate hikes
- BOE's Vlieghe wants to see inflation pick up before voting for hikes
- BOE's McCafferty wants rates at a level that they can cut again
- BOE's Vlieghe doesn't see a reason for rate moves less that 25bps
- Pound gets a lift from AB InBev/SABMiller deal
- Pound on the back foot again after soft inflation data but what did we learn?
- IEA raises 2015 world oil demand growth to record 5 year high
- Germany's Schaueble says a 2016 balanced budget remains their goal
- Germany's VDMA sees engineering sector continuing to stagnate in 2016
- Notable option expiries coming up this week 13 Oct
- Preview: UK CPI data unlikely to inflate hopes of a rate hike
- Option expiries 10am NY cut today 13 Oct
Data:
- September 2015 UK CPI -0.1% vs 0.0% exp y/y
- October 2015 German ZEW economic sentiment 1.9 vs 6.0 exp
- Germany CPI Sept final mm -0.2% as exp
- UK PPI input Sept mm NSA +0.6% vs +0.3% exp
- Switzerland producer and import prices Sept mm -0.1% as expected
- September 2015 US NFIB small business optimism index 96.1 vs 95.5 exp
- Nikkei 225 closes down -1.11% at 18234.74
A big welcome back to our North American readers and I hope your long w-e was a good one.
It's been all about the pound here this morning as a combination of positive M&A impact was trashed by weaker UK CPI
The euro had seen some early love as softer Chinese data spilt over into European equity markets and we saw EURUSD rally from 1.1365 to test 1.1400 and saw EURGBP sitting comfortably around 0.7420 with EURJPY rising to 136.50 from 136.20
But then cue the announcement by SABMiller that they will recommend a revised £44 per share offer from ABInBev and we started to see a sharp rally in the pound with cable rising from 1.5320, and going nowhere fast, to 1.5388 taking EURGBP down through good demand at 0.7400 to post 0.7392
Already finding a few sellers we then saw a rapid drop back down through 1.5350 then 1.5300 as leaks of the data ( allegedly ) hit the streets with EURGBP triggering stops through 0.7430 to post 0.7455 just prior to the data release.
Then it was down to 1.5250 and up to 0.7473 on the with the softer reading confirmed and then, just to give it another kicking, we had MPC new boy Vielghe showing his dovish side. Even known hawk McCafferty spoke with trimmed talons
Elsewhere we've seen USDJPY dip on lower Nikkei from 120.00 to 119.80 then some yen pair selling to 119.61 while USDCHF has bee treading water between 0.9580-0.9600 also seeing some good two-way cross action
AUDUSD has found itself on the back foot around 0.7300 after Chinese data-led falls in Asia while USDCAD has gently wound its way from 1.3020 to 1.305 on softer oil. NZDUSD made its way to 0.6710 from 0.6680 to 0.6710 on softer USD tones but then ran out of puff again
Another lively session with blink and you miss it action on GBP. Caution is advised
