Euro inflation data dominates quiet day

18 July, 2017

Matthew Boyle

Yesterday was a very quiet day indeed in the way of Ecostats, with the only real release of note coming in the form of Eurozone inflation data. Month on Month comparisons came in as was predicted by the yearly figure showed marginal improvement, and as such throughout the day the Euro made gains – around 50 pips against the Pound and nearly a cent against the Dollar. Elsewhere in the world in similar reports Chinese GDP showed growth whilst New Zealand’s figures in fact showed a negative result and a slowdown.

Today is a much busier day in terms of data as we see as we see many key releases, particularly from the UK and Eurozone. Early morning, we have the ECB bank lending survey which is a measure of economic developments and helps drive monetary policy. This is then followed by a raft of Ecostats from the UK including Retail Price Index, House Price Index, Consumer Price Index, and inflation data. Inflation will be a key reading here as we have seen in recent weeks the Bank of England ponder an interest rate hike, which is of course closely linked to this indicator. In the afternoon data release shifts across the pond to the US as they provide import and export data.

However, it is BoE Governors Mark Carneys speech at 14.30 which many will be focussed on for any hints to the potential interest rate hike and whether it will be this year, next year, or at all. Certainly, any hints could see the Pound find some strength and rally, but should this be put off and combined with the currently strong Euro it could quite as easily fall. Equally we must also remember that the ECB have suggested they may raise rates in the short-term, so it seems the race may be on.

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