The pound consolidated against its major rivals during the overnight trade before labour statistic data is released today at 9:30. The unemployment gauge is expected to have remained unchanged at 8.3% in November, while claimant count are expected to have increased by 7.0K in December. Also scheduled for today is weakly earnings release, with expectations for the figures to have increased by 2.0% in November. Separately, Bank of England policy member, Adam Posen, said in a speech yesterday that the concerns of the increased inflation in near future are “unfounded”. He said that the challenge actually will be to keep “inflation expectations anchored in the face of real rather than nominal volatility”.
The euro remained supported against its major rivals for a second day in a row on speculation the Greek government is nearing a deal on its debt. Greece will resume talks today with the Institute of International Finance (IIF), which represents private creditors in Greek government bonds. The IIF broke off the negotiations last week after failing to determine how much money investors will lose by swapping their bonds. Regardless of the outcome of the negotiations, the Fitch Ratings said that Greece will fail to fully honor bond payment, adding to concern that first sovereign default would further undermine single currency. With light economic calendar scheduled for today, market attention will remain focused on the periphery of the Eurozone, as Portugal is auctioning government bonds today.
The dollar consolidated during the Asian session after the report showed that manufacturing in New York region expanded at the fastest rate in nine months, boosting demand for higher yielding assets. The Fed’s NY manufacturing index rose to 13.5 from revised 8.2 in December. Looking ahead to today, industrial production release headline the economic calendar, with the expectations for the numbers to have increased by 0.5% in December after dropping by -0.2% in the prior month. Expect for the dollar to remain in current ranges as world’s largest economy is showing further signs of recovery.
Comments