Today global economy watchers eagerly look forward to the President-elect Donald Trump’s first speech since his election at his news conference at Trump Tower in New York. Market participants are hoping for details about his policies on tax, fiscal spending and international trade. On the data front, the sole release scheduled in the US today is the weekly mortgage applications figures.
The British economy will find itself under a microscope today as a string of economic data points slowly cross the wires. The just-out data showed that UK’s industrial production surpassed investor expectations in November. Later today, the NIESR will release UK’s Q4 GDP estimate. Additionally, the Bank of England (BoE) Governor, Mark Carney is set to testify in front of his fiercest critics, the British Parliament’s Treasury Select Committee.
Pound Sterling – UK Markets
The Pound is trading lower against the US Dollar and the common currency this morning. The just out key economic data in the UK showed that manufacturing production rebounded strongly in November. Furthermore, Britain’s industrial sector marked a strong turnaround in the same month, adding to the recent deluge of upbeat economic releases from the country. Meanwhile, the nation’s construction output unexpectedly fell and the total trade deficit widened in November.
Later in the day, the National Institute of Economic and Social Research is set to release UK’s GDP estimate for the three months ended December. The indicator is likely to show that the British economy grew at a quarterly rate of 0.5% during the period, after recording three consecutive readings of 0.4%. The GDP estimate will be closely watched by market participants as it provides a better picture of the economy, as investors are still trying to gauge the impact of the Brexit vote. Traders will also focus on the BoE Governor, Mark Carney’s testimony as he appears before the Treasury Select Committee.
US Dollar – US Markets
This morning, the US Dollar is trading higher against the Pound and the shared currency. Ahead in the session, the newly elected US President, Donald Trump is scheduled to hold his first press conference post-election at the Trump Tower in New York. On the economic front, investors will keep a tab on the US weekly mortgage applications data, due later in the day.
Yesterday, data showed that US NFIB small business optimism index showed a dramatic improvement in its December read. The index surpassed market expectations and notched its highest level in the last 12 years. Additionally, the US Bureau of Labour Statistics’ job openings and labour turnover summary, a gauge closely watched by Fed Chairwoman, Janet Yellen, indicated that monthly job openings in the nation advanced more than anticipated for November. In other news, the country’s wholesale inventories posted the biggest rise in 2 years for November, indicating an expansion in production activities which is likely to boost GDP growth for the final quarter of 2016.
Euro – European Markets
The Euro is trading higher against the Pound and lower against the US Dollar this morning. The Eurozone economic calendar which is usually buzzing with economic data points, sports a dull look for the second consecutive day today. The sole economic release comes from Spain. The National Institute of Statistics showed that Spanish industrial output advanced more than expected in November. Tomorrow, market participants will focus on the European Central Bank’s monetary policy minutes from its December meeting. It is expected to provide an in-depth insight into the sentiment at the heart of the committee and economic projections that influenced their decision to reduce the amount of monthly asset purchases.
The shared currency ended lower against its major peers yesterday. On the release front, French industrial production posted a surprisingly strong rebound in November, thus indicating a sharper than expected pick-up in activity in the Euro zone's second largest economy.
Other Currencies – Highlights
The Canadian Dollar is trading lower against its US counterpart this morning. As the economic data docket in Canada remains empty for today, traders will be looking forward to the newly-elected US President, Donald Trump’s first press conference scheduled later in the day. Further ahead this week, Canada’s new housing price index and existing home sales data are up for release.
Yesterday, data from Canada’s Mortgage and Housing Corp. showed that Canada’s housing starts blew past market expectations in December. Meanwhile, another report indicated that the nation’s building permits fell less than expected in November. Earlier in the week, the Bank of Canada released its quarterly business outlook survey, which indicated that businesses in Canada were more positive about their hiring and investment prospects, helped by robust domestic demand and better export forecasts. During the previous 2 years, a sharp drop in global energy prices had weakened the nation’s economy and had also led to significant cutbacks in some sectors.