Summary:
- British pound trades subtly higher in anticipation of the labour market report
- GDP from the European economy
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API release on crude oil stocks should draw attention this evening
Tuesday is bringing relief to EM currencies as most of them are recovering this morning with the Turkish lira rising more than 2.5%. During the day major focus will be on the British pound due to the labour market report for June. On top of that, we will get a preliminary print of Eurozone’s GDP growth for the second quarter.
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Create account Try a demo Download mobile app Download mobile app9:30 am BST - UK, Labour Market Report: The British pound has been hit hard of late even as the Bank of England decided to hike rates as expected. Notice that the major reason behind such underperformance is Brexit as negotiations will enter into their crucial phase this fall. The pound has suffered from the US dollar strength as well, hence each macroeconomic release could be viewed as a change to inject more life into the currency. The June’s report is forecast to show the steady unemployment rate of 4.2% and unchanged wage growth irrespective of bonuses are excluded or not.
10:00 am BST - Eurozone, GDP for 2Q: Economic growth in the Eurozone has already passed its peak in this business cycle as evidenced by the two weaker readings this year (in annual terms). Today’s reading should confirm the preliminary reading of 2.1%, but do notice that the ECB’s 2018 GDP forecast seems to be at stake given that growth momentum has lost steam more than expected. On a quarterly basis, economic growth should total 0.3%.
9:40 pm BST - US, Weekly Crude Oil Inventories: Last week, the API data brought a more-than-expected decrease in crude oil stocks. However, the US Energy Information Administration did not confirm these numbers showing only a 1.35 mn decline in inventories. May today’s reading shake the oil market? A 2.7 mn drop is expected, comparison to the previous 6 mn decline.
The GBPUSD has been moving within the possible descending channel (green lines) for nearly two weeks. On Tuesday morning, the pair is approaching the upper bound of the mentioned channel. Could the labour market report change this outlook? Source: xStation5
