Intraday Market Thoughts

UK Jobless Rises, Eurozone Inflation Steady, More Bernanke

by Patrik Urban
Mar 14, 2012 11:17

UK claimant count rose but unemployment rate steady; Swiss ZEW improved; Eurozone CPI steady y/y but rose m/m; Italian auction sees full take up. Market turns to current account balance, Canadian capacity utilization and chairman Bernanke's speech. AUDUSD. GBPUSD, EURUSD, CADJPY and oil are among the latest ideas in our Intermarket Insights . See below for more.

The USD is stronger in the ongoing session against AUD, NZD and JPY, unchanged against CAD and CHF and slightly weaker against EUR and GBP. European equities are higher by about 1% and the relative strength losers are JPY and NZD.

Strong retail sales combined with cautiously optimistic FOMC statement and later with positive stress test results have boosted the greenback. Gold and other precious metals continue to be under pressure as the FED gave no hints of QE and instead acknowledged inflationary pressures.

In the UK, the claimant count rose to 7.2K in February from previous 6.9K but the claimant count rate remained steady at 5% of workforce. The ILO unemployment rate stayed at 8.4%. GBP has been supported by buying on the crosses lately but rising jobless claims that reached the highest level since 11/2009 could send it lower, especially against the buck. GBPUSD fell on the news from 5742 towards 5700.

On the data front, Swiss ZEW economic expectations for March improved to 0 from -21.2; the annual Eurozone CPI in February was confirmed at 2.7% (core CPI stayed at 1.5%) but prices rose 0.5% on the month. Eurozone industrial production rose in January 0.2% after a sharp 1.1% fall seen in December.

Italy reached a full take up as it sold EUR 6 bln worth of 2015 and 2019 bonds today. The 3 year yield was the lowest since 10/2010.

The NY session starts at 8:30 am ET with current account deficit that is expected to widen in Q4 to USD 114 bln from 110 bln and Canadian Q4 capacity utilization rate that is seen higher at 81.6% from 81.3%.

Fed chairman Bernanke speaks at 10:00 am in a video conference in Nashville so volatility could increase.

Crude oil inventories due at 10:30 are anticipated to rise to 2.2M barrels from 0.8M barrels last week.

AUDUSD, GBPUSD, EURUSD, CADJPY and oil as well as key charts on Germany's PMI/IFO/ZEW and on GBPUSD are included in our latest Premium Intermarket Insights. Direct Access here: NONsubscribers can click here:


Latest IMTs