Morning Call

Today is Non-Farm Payrolls Friday, the monthly release of the US employment figures that are closely watched by traders. The US Bureau of Labor Statistics releases the report at 13:30, with the headline number of jobs added during May and the unemployment rate. The Fed’s focus on the threshold unemployment rate of 6.5% seems to be waning, with the wage growth and capacity the concentration. Following the release there is usually considerable volatility as traders attempt to react…

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The latest rate decision from the European Central Bank will be announced today at 12:45 GMT. This is the most eagerly awaited rate decision, certainly for quite a few months, possibly ever, especially after President Mario Draghi hinted in their meeting last month that they would act today. Many economists are expecting an unveiling of a package of measures but there are some discrepancies over the exact ones to be used. Since the May meeting, pressure has only increased on President…

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UK Services Purchasing Managers Index (PMI) was released at 9:30 on Wednesday, slightly above expectations at 58.6, versus April’s 58.7. This is another strong print for the UK economy and reinforces the strength in the economic recovery. The services PMI accompanies strong survey reports from the manufacturing and construction sectors, pointing towards a relatively balanced recovery. A highlight of the statistical release was the service sector employment growth strengthened to…

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The World Cup starts on the 12th June running until the 13th July, being hosted by Brazil, South America. The global scale of the sport means that there are significant amounts of money invested into advertising, hospitality, sponsorship and infrastructure. Is there a correlation between the fortunes of a football team in the tournament and a nation's currency? Well in short, no, there isn’t a direct link over the long term, but the tournament does have an impact on the marke…

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The UK Building Society, Nationwide released their monthly House Price Index in May, showing that prices continued to edge higher. In May prices grew by 0.7% and were up by 11.3% compared with May 2013. The average home in the UK now costs £186,512. House prices and Sterling House prices have become a contentious factor and the potential caveat for increasing base interest rates from the record low of 0.50%. The growth in property prices has fuelled concerns from analysts a…

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New official statistics have been released by the HM Treasury today detailing that some 7,313 homes have been sold so far under the 2nd part of the Help To Buy mortgage guarantee scheme covering the six months from 8th October 2013 to 31st March 2014; a further 20,548 new homes were sold through the scheme’s first instalment during the 13 months proceeding this. It cannot be argued that the scheme has indeed helped a lot of hard working people successfully get on the housing ladd…

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The Confederation of British Industry’s (CBI) has reported today that retail sales growth remains steady, with the sixth consecutive month of growth. According to the Quarterly Distributive Trades Survey, the growth was at a slightly slower pace in May compared with the previous month. The release from the CBI noted that department stores’ volumes had declined compared with a year ago, which was replaced with strong performance in internet sales. The high-street continues to be u…

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The Office for National Statics (ONS) released their second estimate for the first quarter of the year’s economic growth in the UK at 9:30 this morning. The estimate was in-line with their first estimate at 0.8%, and was the fifth consecutive increase. This is a positive release for the UK economy following yesterdays, impressive retail sales figures. According to the ONS: "This is the longest period of continuous growth since the 2008-09 downturn and GDP now stands at 0.6%…

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The Bank of England Minutes of the MPC meeting for the 7th and 8th of May were released at 9:30am today. The MPC voted 9 – 0 to leave interest rates unchanged at 0.50% and asset purchases on hold at £375bn. The minutes were more hawkish than previous, with the first hint of a change in tone. The key line in the release: The Committee would continue to refine its views as the economy evolved, and for some members the monetary policy decision was becoming more balanced.…

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CPI data released by the Office for National Statistics (ONS) this morning, was slightly higher than expected, and up on March. The release for April was 1.8%, with the expectations of 1.7% versus March’s 1.6%. This is still below the Bank of England’s 2% inflation target, but it was the first increase of inflation in 10 months. The ONS noted that the increase was primarily attributed to transport costs; notably air fares, sea fares and motor fuels. The release also highlig…

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The Bank of England’s Monetary Policy Committee (MPC) released their inflation report for May 2014. The dovish tone of the pre-prepared text, led to sterling trading new session lows in the FX market, as the optimism for an interest rate hike in the near term was dampened as Carney attempted to lower expectations. The BoE left their forecasts for both inflation and growth almost unchanged from the previous release, reinforcing the expectation for a rate hike will not be until 2015.…

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The Bank of England has the enviable position that the UK economy is growing and needs to time the exit of ultra-loose monetary policy. Interest rates have been at the record low (0.50%) for over 5 years, and the economy is in recovery mode. The majority of economists are pencilling in a rate rise for Q1/2 in 2015. How is the economy doing? Economic growth: 3% for 2014 and 2.4% in 2015 (Confederation of British Industries) 2.9% for 2014 and 2.7% in 201…

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Following the low volumes experienced during the European Bank Holiday weekend, it has been another bullish start to the working week for GBPUSD; trading up to 1.6990 in Tuesday’s European trading session. The question is, however, is this trend set to continue? The general consensus on the street seems to be that it will, with some forecasting that there could be a rise to 1.76 by Q4; strong economic data in recent weeks have been cited and with renewed expe…

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The eagerly anticipated monthly US employment release is today at 13:30 BST (London). The Depart for Labor releases the Non-Farm payroll employment report, which covers jobs in goods, manufacturing, and construction companies but excludes farm workers, non-profit organisations and private households. This release will closely watched by traders following the abysmal US Q1 GDP release of 0.1% growth. The figure was a huge disappoint, though the cold weather has been largely blamed for t…

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