14 Jan: Brexit vote in focus this week. Inflation data due from UK, Germany, EU, Canada. Politics to drive direction.

By | January 14, 2019

The US$ ended mixed on Friday following on from the release of the US CPI, which slowed to 1.9% yy in December, down from 2.2% but matched expectations. The Core CPI was unchanged at 2.2% yy, also matching expectations. The best performers of the session were the Aud$, which received a boost from the solid Retail Sales reading, and pulled the Kiwi higher with it; while Cable also headed higher on rumours that there will be delay in the Brexit date, with the UK press now reporting the possibility of a delay in Brexit until July. The Euro on the other hand was heavy during Friday’s US session, partly on stories of Turkey lining up troops on the Syrian border but more-so under some pressure from selling of EurGbp. Elsewhere the currency markets were choppy and unexciting .

Stocks were mildly lower, under pressure from a decline in energy shares and on mounting concerns about the ongoing government shutdown, and came ahead of the commencement of this week’s company reporting season. WTI dipped Friday as traders took profit on the recent rally, ahead of the weekend, possibly in order to assess OPEC’s ability to counter the U.S. shale boom, ending the day down 1.6%. Gold finished mildly higher but well within its recent range.

The coming week will see a rather thin economic calendar and it would appear that politics will lead any directional move, with Tuesday’s Brexit vote in particular being in focus, along with the US/China trade negotiations and the US Government shutdown. The economic highlights of the week are likely to be the inflation data, with CPI figures due from Germany (Wed), the EU (Thur), the UK (Wed) and Canada (Fri).  Elsewhere the main items on the agenda will be the US PPI (Tue), US Retail Sales (Wed) and the Industrial Production, Capacity Utilisation, Wholesale Inventories, Michigan Consumer Sentiment Index(Fri).

Today kicks off the week with the China Trade balance (exp Imports +3%, Exports +5.4%, Surplus;US$50.75 bio).

Have a good week.

Economic data highlights will include:

Mon: Japan Holiday, Australian Consumer Inflation Expectation, China Trade Balance, Foreign Direct Investment, EU Industrial Production

Tue: Brexit Vote, Japan Machine Tool Orders, EU Trade Balance, US New York State Empire Mfg Index, PPI, Global Dairy Trade Index

Wed: NZ Electronic Card Retail Sales, Japan Machinery Orders, China House Price Index, German CPI, UK CPI, PPI, RPI, US Retail Sales, Import/Export Index, Business Inventories, NAHB Housing Market Index, EIA Crude Oil Stocks Weekly Change, Beige Book

Thur: Australian WBC Consumer Confidence , Home Loans, Investment Lending for Homes, New Home Sales, German Wage Price Index, EU CPI, Construction Orders, US Building Permits, Housing Starts, Philadelphia Fed Mfg Survey, API Weekly Crude Oil Stock Inventory

Fri: NZ Business PMI, Japan National CPI, EU Current Account, UK Retail Sales, US Industrial Production, Capacity Utilisation, Wholesale Inventories, Michigan Consumer Sentiment Index

CURRENCIES
EURUSD: 1.1462
Res  1.1495  1.1540  1.1570
Sup  1.1435  1.1390  1.1345
USDJPY: 108.50
Res  108.60  108.75  109.00
Sup  108.35  108.15  107.90
GBPUSD: 1.2848
Res  1.2865  1.2890  1.2925
Sup  1.2810  1.2780  1.2745
USDCHF: 0.9837
Res  0.9865  0.9890  0.9920
Sup  0.9810  0.9785  0.9760
AUDUSD: 0.7210
Res  0.7220  0.7235  0.7250
Sup  0.7185  0.7165  0.7145
NZDUSD: 0.6825
Res  0.6840  0.6860  0.6880
Sup  0.6815  0.6795  0.6775
INDICES / COMMODITIES
S&P.fs: 2590
Res  2600  2615  2630
Sup  2575  2560  2545
DJ30.fs: 23900
Res  24000  24080  24215
Sup  23800  23670  23530
SPI200.fs: 5740
Res  5755  5770  5795
Sup  5720  5695  5670
XAUUSD: 1287
Res  1290  1295  1300
Sup  1285  1280  1275
XAGUSD: 15.60
Res  15.70  15.85  16.00
Sup  15.50  15.40  15.25
WTI.fs: 51.75
Res  52.40  53.35  54.55
Sup  51.15  50.30  49.35