Markets continue to adapt to Trump

Yesterday’s markets

15th November 2016

  • CHF PPI m/m: 0.1%
  • EUR Industrial Production m/m: -0.8%
  • EUR ECB President Draghi Speaks
  • AUD Monetary Policy Meeting Minutes

Yesterday, Markets continued to transition to president-elect Donald Trump as investors attempt to gain clues into the policies he will be delivering and predicting who Trumps cabinet members will be. Over the weekend Trump announced RNC Chairman Reince Priebus as his chief of staff and former Breitbart News Executive as chief strategist and senior advisor. Trump also mentioned that same-sex marriage is settled law and that the famous border wall with Mexico could be a fence as he begins to go back on some of his campaigns policies.

Price action was relatively subdued yesterday as data releases were light. EURUSD continued to fall, breaking another key psychological level yesterday. Some economists are now forecasting that EURUSD called decline to parity by as soon as year-end. The move also pushed GBPEUR higher, whilst GBPUSD depreciated 0.7% throughout the European session.

Today’s markets

14th November 2016

  • EUR German Prelim GDP q/q
  • AUD RBA Gov Lowe Speaks
  • GBP CPI y/y
  • GBP Inflation Report Hearings
  • USD Core Retail Sales m/m
  • USD Retail Sales m/m

Today, Inflation from the UK takes centre stage as Consumer Prices are due to increase slightly to 1.1%.  With the Pound nosediving after the Brexit vote the cost of importing goods has been starting to filter through to Consumer Prices, and has risen sharper than the BoE expected.  If a jump above the expected 1.1% is seen, this could lead markets to ponder what and how the Bank of England will intervene. In the afternoon, the US see how strong their consumer market is as they release the monthly Retail Sales figure, which is anticipated to remain constant at 0.6%.