• Weekly briefings
• Archive

UK Data

• Tuesday 11.00am CBI Industrial Trends Q3 previous 6.0
• Thursday 9.30am BBA Mortgage approvals for September previous 61.1

A better then expected Q3 GDP out on Friday caused Sterling to strengthen against US Dollar finishing the week pivoting the 2.05 level. We also saw retail sales beating expectations at 0.6% m/m and a boost in the annualised figure to 6.3%. Average earnings also exceeded expectations at 3.7% which was the highest figure since April of this year. Earlier in the week saw CPI out below the 2% target at 1.8%. The BOE minutes were expected to show an unanimous decision to keep rates on hold actually showed that one member (David Blanchflower) voted to cut rates. This week the market will focus on the CBI industrial trends survey and BBA mortgage approvals for any further indication as to the likelihood of a rate cut from the MPC in the months ahead.

US Data 

• Wednesday 15.00pm Existing home sales for September previous 5.50
• Thursday 13.30pm Durable goods orders for September previous -4.9
• Thursday 15.00pm New home sales for September previous 795k
• Friday 15.00pm University of Michigan Sentiment Survey for October previous 83.4

The dollar traded on the back foot for most of the week with a new high being posted in €/$ at 1.4319. The TICS data disappointed the market coming in at $51.5bn which was not enough to cover the September trade deficit of $57.9bn. Housing starts were also down at 1.19m from 1.331m the previous month. The CPI data beat market expectations and the previous months figure coming out at 0.3% m/m. This demonstrates how inflation is still going to be of concern for the Fed going forward. This week, attention will once again be on the fragile US housing market for any indication as to whether or not the Fed will need to cut rates when they meet next week. 

Euro Data

• Tuesday 10.00am EU Industrial New Orders for August previous -4.0
• Wednesday 9.00am Manufacturing PMI for October previous 53.2
• Wednesday 9.00am Services PMI for October previous 54.2

Key data from the Eurozone last week continued to paint a robust picture of the European economy and boosted the Euro against the Dollar and Sterling. The German ZEW was expected to weaken further from the previous -18.1 but came in line with the previous month at -18.1. There were also signs that inflationary pressures are likely to keep the ECB on high alert with HICP (2.1%y/y) pushing back above the ECB’s 2.0% target rate. The news helped push the Euro to a new all time high against the dollar at 1.4319. This week, the market will look towards the PMI indexes for Manufacturing and Services for an indication of sentiment surrounding the Eurozone economy

Interest rate outlook