Oil Reaches Highest Price this Year Ahead of US CPI

Market movers today The most important data release of the day will be the US August CPI. In the euro area, we receive industrial production figures for July. The industry has suffered the whole year and recent business surveys suggest that the suffering only got worse in July. In the UK, the monthly GDP estimate […]

Sterling Slides After GDP Data as Odds of BoE Hold Next Week Slightly Improve

The UK economy contracted faster than expected in July which is weighing on the pound this morning. GDP fell 0.5%, much faster than the 0.2% contraction that was expected, but as has been the case throughout this year, one-off factors played a big role. Strikes and the weather were largely blamed for the steep decline although some are clearly worried that overall momentum in the economy remains weak.

Speculators Have Lost Interest in the Crypto Market

Crypto is out of volatility mode, moving in a narrow range of around $1.04 trillion over the last 24 hours, with little change in the total cap. This could be another pause before a new step down the ladder, as we have seen since July, or a preparation for further growth. We are now leaning towards the first option.

Australian Dollar Steadies After Solid GDP

The Australian dollar has edged higher on Wednesday, after sustaining sharp losses a day earlier. In the European session, AUD/USD is trading at 0.6391, up 0.19%.

USD/CAD Rises to 22-Week High, BoC Decision Looms

USD/CAD is trading quietly in Europe at 1.3651, up 0.06%. I expect to see stronger movement in the North American session, with the Bank of Canada making its rate announcement and the US releasing the ISM Services PMI which is expected to show little change.

Has Euro/Dollar Entered Bearish Trend or Is It in Correction?

With economic numbers out of the Eurozone heightening recession concerns, and US data keep pointing to a superior US economy, the euro/dollar pair has been in a sliding mode recently.

Euro Steady Higher Despite Soft German, Eurozone Data, US Services PMI Next

The euro has steadied on Wednesday, following sharp losses a day earlier. In the European session, EUR/USD is trading at 1.0731, up 0.09%.

Sunset Market Commentary

Uncertainty on the health/recovery of the Chinese economy and a higher oil price due to prologued production cuts from Saudi-Arabia and Russia cloud the global economic outlook and triggered a mild risk-off reaction on Asian markets.

ISM Index Shows Healthy Services Sector Expansion in August

After a bumpy few months, the services sector is showing renewed verve. The headline index has posted gains in two of the past three months and is approaching levels registered in January and February. That said, the expansion is not progressing at the same pace as in 2021 and 2022. Growth looks set to proceed at a more moderate pace as the new orders and business activity sub-indexes are both a touch below their respective ten-year averages.

Bank of Canada Holds Policy Rate at 5% 

No surprises today as the BoC held the policy rate at 5%. With last week's GDP release showing a contraction in the second quarter, and growing signs of a cooling in the job market, there was little pressure for the BoC to keep raising rates. Our expectation is that this period of "weak economic growth" is set to continue over the rest of this year and into early 2024.