British Pound May Bounce as Focus Reverts to BOE Rate Hike Bets
Talking Points:
- British Pound May Recover as Focus Returns to BOE Rate Hike Speculation
- US Dollar Extends Advance to Hit New 2014 High on Firming Fed Outlook
- See Economic Releases Directly on Your Charts with the DailyFX News App
The British Pound remains in focus in European hours after yesterday’s dramatic selloff brought the currency to the lowest level in 10 months. The plunge was triggered by Scottish Independence referendum jitters after a poll released over the weekend showed those intending to vote in favor of seceding from the UK outnumbered those favoring the status quo for the first time.
The Scottish issue will not find clear-cut resolution until the referendum is held next week (September 18) and a result is evident. Having priced in a greater degree of secession risk, the markets may now find themselves without sufficiently novel news-flow to make the situation appear markedly worse at the margin. That hints that the ability of Scotland-linked worries to continue driving Sterling is limited in the near term.
In the meantime, monetary policy considerations are set to make their return to the spotlight as Bank of England Governor Mark Carney takes to the wires. The central bank chief is due to address the Trades Union Congress in Liverpool today. If his remarks reinforce the emerging hawkish shift in policymakers’ thinking, swelling rate hike speculation may offer a lifeline to the beleaguered UK unit.
The US Dollar outperformed in overnight trade after recording the largest daily rally in 15 months in the previous session. The greenback added as much as 0.2 percent on average against its leading counterparts, putting in a new high for the year. The advance tracked a pickup in US Treasury bond yields, pointing to a firming Fed policy outlook as the catalyst.
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Asia Session
|
GMT |
CCY |
EVENT |
ACT |
EXP |
PREV |
|
22:00 |
NZD |
ANZ Truckometer Heavy (MoM) (AUG) |
-1.2% |
- |
2.5% |
|
22:45 |
NZD |
Card Spending Total (MoM) (AUG) |
0.3% |
- |
-0.2% |
|
22:45 |
NZD |
Card Spending Retail (MoM) (AUG) |
0.5% |
0.6% |
0.1% |
|
23:01 |
GBP |
BRC Sales Like-For-Like (YoY) (AUG) |
1.3% |
0.3% |
-0.3% |
|
23:30 |
AUD |
ANZ Roy Morgan Consumer Conf (Weekly) |
113.3 |
- |
112.6 |
|
23:50 |
JPY |
Tertiary Industry Index (MoM) (JUL) |
0.0% |
0.2% |
0.0% |
|
23:50 |
JPY |
Japan Money Stock M2 (YoY) (AUG) |
3.0% |
2.9% |
3.0% |
|
23:50 |
JPY |
Japan Money Stock M3 (YoY) (AUG) |
2.4% |
2.4% |
2.5% |
|
23:50 |
JPY |
BOJ Releases Minutes from Aug Meeting |
- |
- |
- |
|
1:30 |
AUD |
NAB Business Conditions (AUG) |
4 |
- |
8 |
|
1:30 |
AUD |
NAB Business Confidence (AUG) |
8 |
- |
10 |
|
1:30 |
AUD |
Investment Lending (JUL) |
6.8% |
- |
0.1% |
|
1:30 |
AUD |
Value of Loans (MoM) (JUL) |
0.0% |
- |
1.7% |
|
1:30 |
AUD |
Home Loans (JUL) |
0.3% |
1.0% |
0.1% |
|
5:00 |
JPY |
Consumer Confidence Index (AUG) |
41.2 |
42.3 |
41.5 |
|
6:00 |
JPY |
Machine Tool Orders (YoY) (AUG P) |
- |
37.7% |
European Session
|
GMT |
CCY |
EVENT |
EXP |
PREV |
IMPACT |
|
8:30 |
GBP |
Industrial Production (MoM) (JUL) |
0.2% |
0.3% |
Medium |
|
8:30 |
GBP |
Industrial Production (YoY) (JUL) |
1.3% |
1.2% |
Medium |
|
8:30 |
GBP |
Manufacturing Production (MoM) (JUL) |
0.3% |
0.3% |
Medium |
|
8:30 |
GBP |
Manufacturing Production (YoY) (JUL) |
2.2% |
1.9% |
Medium |
|
8:30 |
GBP |
Visible Trade Balance (£, m) (JUL) |
-9100 |
-9413 |
Low |
|
8:30 |
GBP |
Total Trade Balance (£, m) (JUL) |
-2300 |
-2459 |
Low |
|
8:30 |
GBP |
Trade Balance Non EU (£, m) (JUL) |
-3600 |
-3841 |
Low |
|
10:45 |
GBP |
BOE Governor Carney Speaks in Liverpool |
- |
- |
High |
Critical Levels
|
CCY |
Supp 3 |
Supp 2 |
Supp 1 |
Pivot Point |
Res 1 |
Res 2 |
Res 3 |
|
EURUSD |
1.2755 |
1.2834 |
1.2864 |
1.2913 |
1.2943 |
1.2992 |
1.3071 |
|
GBPUSD |
1.5877 |
1.6011 |
1.6058 |
1.6145 |
1.6192 |
1.6279 |
1.6413 |
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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