Morning Commentary: The Euro and British Pound Head Lower
Get link
Facebook
Twitter
Pinterest
Email
Other Apps
A daily summary and commentary of events and factors that affect the global markets, with a particular emphasis on the foreign exchange markets.
The Euro and British Pound Head Lower
Share this story:
David Atkinson Foreign Exchange Sales Manager
The U.S. dollar is broadly higher this morning, but it is more weakness in European currencies rather than a good news story for the dollar. The euro is at a 2-month low just above the 1.14 level on the interbank market as Eurozone headline Purchasing Manufacturer's Index hits a 2-year low. The culprit continues to be concerns about how the situation with Italy's budget will play out. A break of a key technical level at 1.1430 exacerbated the move.
British pound sterling is at its lowest level since early September, hanging in the low 1.29s on the interbank market. This is due to continued worries about what will happen with Brexit and the future of PM May's tenure at 10 Downing St.
The Bank of Canada releases its rate decision this morning, with markets fully pricing in a 25% rate hike to 1.75%. Recent softer data still pales in comparison to markets' delight that the NAFTA rewrite seems to be on track.
U.S. equities are opening somewhat flat today after a wild ride yesterday. As we have been discussing, it is all earnings these days. Yesterday, poor and worrying reports from 3M and Caterpillar sank equities at the open, but markets rebounded to close about half of a percent lower on the day. Today, Boeing, which makes up 9% of the Dow Jones Industrial Average, came out with rather spectacular earnings; they had a 37% increase in free cash flow, earnings that beat estimates and they predicted that sales would reach $100 billion for the first time.
HERE ARE THE KEY NEWS STORIES FROM OVERNIGHT:
The Swedish central bank – the Riksbank – kept its benchmark rate at -0.50% as expected but indicated that it will soon begin to raise rates, but at a slow pace. This is rather significant as we have had very little indication heretofore from European banks ready to indicate more of a normalization of rates. This ups the attention that will be paid to the ECB rate decision and press conference tomorrow.
Want to learn more about international finance, economics, and global events? Sign up for our other Foreign Exchange emails and videos!
Follow City National Bank on social media:
Investment and Insurance Products:
•
Are Not insured by the FDIC or any other federal government agency
•
Are Not deposits of or guaranteed by a Bank or any Bank Affiliate
•
May Lose Value
This report is for general information and education only and was compiled from data and sources believed to be reliable. City National Bank does not warrant that it is accurate or complete. Opinions expressed and estimates or projections given are those of the authors as of the date of the report with no obligation to update or notify of inaccuracy or change. This report is not a recommendation or an offer or solicitation to buy or sell any financial instrument discussed. It is not specific investment advice. Financial instruments discussed may not be suitable for the reader. Readers must make independent investment decisions based on their own investment objectives and financial situations. Prices and financial instruments discussed are subject to change without notice. Instruments denominated in a foreign currency are subject to exchange rate and other risks. The Bank (and its clients or associated persons) may engage in transactions inconsistent with this report and may buy from or sell to clients or others the financial instruments discussed on a principal basis. Past performance is not an indication of future results. This report may not be reproduced, distributed or further published by any person without the written consent of City National Bank. Please cite source when quoting.
Tune in for a guide to ETFs and investing strategies for potential long-term success. View in a browser Fidelity Fidelity Log in Creating a portfolio with ETFs: Why and how Creating a portfolio with ETFs: Why and how
View this email in your browser Want to watch a recording of yesterday's Simply Successful Investing Webinar. Just click here and use passcode 5q59Z&3M.
Exclusive webinar: The market, my portfolio, and options. Exclusive webinar: The market, my portfolio, and options. View in a browser Fidelity Fidelity Log in The market, my portfolio, and options The market, my portfolio, and options
Comments
Post a Comment