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via Barclays

  • Asia stocks under pressure as USD stays near 14-year high
  • Preliminary GDP data for Q3 shows continued UK resilience
  • Focus today will be on UK inflation data, US retail sales and Mark Carney’s speech

The USD held near a 14-year high yesterday and Treasury yields extended their rise as investors braced for stronger inflation in the United States amid expectations of expansionary fiscal policies under Donald Trump’s presidency

The combination of the two have derailed Asian currencies and equities, with analysts expecting more gains for the USD in the short term, resulting in further headwinds for Asia

UK activity in Q3 16 proved more resilient than anticipated as the preliminary GDP growth estimate printed 0.5% q/q

However, this resilience will be tempered by inflationary pressures on the horizon, and Barclays Research “…believe it will be difficult for recent economic activity momentum to be sustained in face of said pressures, and furthermore we acknowledge that the recent sharp rise in input prices poses some upside risk to our CPI forecasts…

Euro area industrial production dropped 0.8% m/m in September, slightly less than our and consensus expectations of a 1.0% drop m/m. Overall, industrial production improved in Q3 in line with business surveys; which showed manufacturing confidence improving at the start of Q4 on the back of stronger forward-looking components

Today’s data calendar is busy with inflation and retail sales the key releases, speaker-wise we look to Mark Carney’s speech on the November inflation report at 10:00 as well as FOMC Vice Chair Fischer

Todays’ rates:

GBPUSD: 1.2447

GBPEUR: 1.1531

EURUSD: 1.0796

GBPAUD: 1.6468

EURGBP: 0.8672

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Matt Vann

Matt has been trading for over a decade, trading with various forms of Futures, Spread Betting and occassionally, CFDs. He'll trade limited markets including Indices, Currencies and selected Commodities such as Silver and Natural Gas.

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