Looking for catalysts

Thanim Islam
Profile
Head of FX Analysis at Equals Money
-
3
min read
Publish date
14/03/24
  • US retail sales and PPI to lift volatility?


Recap

FX volatility was extremely low yesterday as we can see from GBP performance below, with similar performance on EUR and USD yesterday.

Today

Market rates

*Daily move - against G10 rates at 7:30am, 14.03.24

** Indicative rates - interbank rates at 7:30am, 14.03.24

Table (92)

Data points

Table (93)

Speeches

  • EUR – ECB Knot, Schnabel, De Cos, Guindos

Our thoughts

After such a quiet day yesterday, focus today falls back on the US as we see how busy US consumers were with their spending in February, and producer price inflation. As we can see we are expecting a pick up in retails sales, as well as inflationary pressures from the PPI numbers. We would expect USD to gain if this is the case, but USD buying has been lacklustre of late, with markets showing preference to sell USD on a weaker number - but, we will see. This can be seen in client conversations as well, with an optimistic preference for a further move higher on GBPUSD. We are seeing similar demand with topside limit orders on EURUSD as well.

ECB Stournaras has been speaking this morning, calling for two rate cuts before their August summer break followed by two further rate cuts by the end of the year. His comments mirror current market pricing. EUR is slightly weaker on the open.

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About the author
Thanim Islam
Profile
Head of FX Analysis at Equals Money

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