GBP moves higher as traders eye vital data out of UK and US today
City Index August 15, 2013 2:35 PM
<p>Yesterday the market finally had some data to which to react. GBP made a move on good claimant count change coming in at a better […]</p>
Yesterday the market finally had some data to which to react. GBP made a move on good claimant count change coming in at a better than expected -29.2k. This sent GBP up around 40 points and has continued its push higher overnight, with the market ignoring the 8-1 vote on forward guidance. Weale disagreed with Carney, possibly showing that Carney has not united the MPC.
The unemployment rate stayed at 7.8% so no surprises there. With an expected drop to 7% in the coming years it remains to be seen whether rates will be raised or if guidance will be amended each time due to data and economic changes. Today could see GBP break even higher, with retail sales data due out at 9.30am, expected better than last month at 0.7%. With UK data being strong so far this could follow suit with the upbeat economy and may push GBP/USD up to 1.5600, which has not been seen since it broke down through the 1.5600 level on 19th June.
Out today in the US is the inflation figure, with no change expected from the previous report, and unemployment claims. Two big data releases for the US setting up the market for next month’s QE tapering predictions, and with Lockhart saying yesterday that QE tapering is possible at any of the next three meetings, and Bullard’s comments on no rush to taper and deflation risks of tapering too soon, the market is still unsure of a definite time when this is going to take place.
Later this afternoon we see the Empire Manufacturing Index, expected to be bit stronger than last month. So important figures to come today. We could see some moves if data is not as expected, giving good judgement of what the market is expecting from the Fed.
Supports 1.3250 1.3230 1.3200 | Resistance 1.3340 1.3375 1.3415
Supports 98.30 98.50 98.80 | Resistance 97.50 97.30
Supports 1.5490 1.5425 1.5390 | Resistance 1.5550 1.5580 1.5675
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