Sterling takes the stage as traders await UK inflation report
City Index May 14, 2014 2:58 PM
<p>The dollar is trading a little softer this morning following a very weak IFO survey yesterday. Media suggestions that the Bundesbank are open to significant ECB […]</p>
The dollar is trading a little softer this morning following a very weak IFO survey yesterday. Media suggestions that the Bundesbank are open to significant ECB stimulus if inflation forecasts are lowered, saw EUR/USD break 1.3700, falling just shy of the April low of 1.3672.
US retail sales for April were a substantial disappointment, although upward revisions to March helped soften the surprise as risk performed well with the S&P briefly trading above 1900.
In overnight news the RBZD said the LVR limits will remain in place until at least late 2014 as they look to slow an elevated housing market. The main risk to New Zealand’s economy remains from the fall in export prices to China and the effects this will have on farmers.
Today will be all about the UK inflation report at 10.30am and initially, the employment data released an hour earlier, which is expected to show a continued strengthening in the labour market. The inflation report is likely to be a rehash of what seems to be a global central bank mantra.
The BoE is likely to put an emphasis on the lack of inflationary pressures, sighting slack in certain parts of the economy with the bullish tilt likely to come from upward growth projections. US PPI data is released this afternoon from across the pond.
Supports 1.3675-1.3625-1.3580 | Resistance 1.3750-1.3780-1.3830
Supports 102.00-101.75-101.40 | Resistance 102.30-102.30-103.00
Supports 1.6840-1.6815-1.6780 | Resistance 1.6900-1.6925-1.6960