UK end-user energy prices hit highest in Europe ahead of Truss announcement, Dollar reaches heights not seen since 2002, Australian Dollar falls near two-year lows.
September 7, 2022
GBP/USD 1.1499 GBP/EUR 1.1609 EUR/USD 0.9905 USD/CAD 1.3192 EUR/CHF 0.9753 EUR/SEK 10.6990 EUR/NOK 9.9390 EUR/DKK 7.4367 USD/ILS 3.4314 AUD/USD 0.6716 NZD/USD 0.6014 USD/SGD 1.4084 USD/JPY 144.10 USD/CNH 6.9845 USD/INR 79.8863 EUR/ILS 3.3987 GBP/ILS 3.9456 USD/ZAR 17.3469
Truss overhauled the British cabinet in her first action since taking office. An announcement on energy aid is due tomorrow, as end-user energy prices in the UK have risen to the highest in Europe. The UKs high dependence on natural gas has made the industry vulnerable to wholesale price rises, despite no reliance on a direct pipeline from Russia.
Plans to intervene in the energy markets could mean that UK inflation has already passed its peak. Despite gains to 1.16 through yesterday, GBPUSD has erased gains, slipping back below 1.15 as we print.EUR
European equities opened lower as investors continue to worry over a looming recession in Europe ahead of a highly anticipated ECB decision tomorrow.
German Chancellor Scholz is touring the country reassuring consumers amid the challenges faced by Germany to keep the lights on this winter. German industrial productions beat estimates with a decline of -1.1% against an expectation of a -2.1% fall.USD
The dollar gained, reaching levels not seen since June 2002 as a strong US services report reinforced expectations of an aggressive federal reserve cycle. The ISM services index rose to 56.9 in August from 56.7 in the previous month, exceeding forecasts of 55.1. The dollar index rose above 110.ASIA/PACIFIC
The Australian dollar declined past 0.675, near its lowest levels in over two years. This move has been driven by the expectation of aggressive tightening from the Federal Reserve and underwhelming Chinese economic data reducing the markets appetite for riskier assets. The Australian economy grew by 3.6% YoY, beating estimates.
China’s export growth slowed, expanding by 7.1% YoY, missing forecasts for a 13% rise.ILS
USDILS trades 0.4% higher safely around 3.43 at time of writing.Data & Events
Euro-Area 2Q GDP
BoE’s Bailey and MPC testify to parliament
Fed release Beige Book
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