I’m still standing
Today's news headlines:
‘ECB plan for next big hike makes Lagarde the last hawk standing’. The European Central Bank started hiking long after most major central banks across the world. Now it looks like the ECB will continue with its hawkish monetary policy path long after the likes of the Federal Reserve and Bank of England halt their hiking cycles. Eurozone inflation is sitting at 8.5%, and recent data shows strength in the economy and labour market. But it appears Lagarde will need some convincing to back down from higher rates, much like the central bank took some persuading to exit the ultra-low rate environment just under nine months ago. (Bloomberg)
‘UK train drivers strike again; risk of more action if talks fail’. Train drivers in the UK continue their strikes today, with 15 train lines and 12,000 drivers thought to be affected. It’s been a week marred by strikes, with 500,000 workers estimated to have taken strike action on Wednesday as disputes over public sector pay packets continue, with no real breakthrough appearing likely at this point in time. A meeting between the Aslef union and the train operators will take place on Tuesday, with more strikes a possibility this month if a compromise is not made. (Bloomberg)
The Dollar is trading higher this morning as equities sell off across the board following missed earnings for Apple, Amazon, and Alphabet after the closing bell yesterday. The Pound is softer following the BoE’s decision to hike by 50bps on Thursday, as a downshift to smaller hikes appears likely. Elsewhere, energy prices continue their decline, with NY Natural Gas futures down 46% year to date.
China Caixin Services PMI (Jan): 52.9 (est. 51.1)
France Industrial Production MoM (Dec): 1.1% (est. 0.2%)
UK Monetary Policy Committee Member Huw Pill speaks: 12:15PM
US Non-Farm Payrolls (Jan): 1:30PM
US Unemployment Rate (Jan): 1:30PM
US ISM Services PMI (Jan): 3:00PM
GBP/USD – 1.2193
GBP/EUR – 1.1192
EUR/USD – 1.0896
USD/CAD – 1.3359
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*Indicative interbank rates taken on the day of writing. Please speak to your Dealer to find out the current rates available for you.