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EURUSD orders 13 August
June EZ industrial production 0.7% vs 0.8% exp m/m
August German ZEW economic sentiment index 42.0 vs 40.0 exp
Cable takes a little 40 pip round trip after UK price data
June UK ONS house prices 3.1% vs 3.5% exp
UK CPI july: y/y +2.8% vs +2.8% exp
July UK PPI Input 1.1% vs 1.4% exp: Output 0.2% vs 0.2% exp m/m
UK data coming up at the bottom of the hour
Technical levels 13 August
USD in demand again
Cable finds early buyers
European equity markets open higher
Shanghai comp index closes up 0.23% at 2106.16
Spanish CPI final july: m/m -0.5% vs -0.1% prev
EURGBP orders 13 August
GBPUSD orders 13 August
Eurostoxx 50 futures open up 0.4%
Nikkei closes on session highs at 13,867.00
German CPI final july: m/m +0.5% vs +0.5% prev
Nikkei posting new session highs

EURUSD orders 13 August

Posted: 13 Aug 2013 02:01 AM PDT

Apols for the late posting but I’ve been a little busy this morning

Currently 1.3294

Sellers 1.3320 1.3330 1.3350 1.3370 1.3390 1.3400 1.3410 1.3420 ( stop loss buying if 1.3425 breached ) 1.3450

Buyers 1.3280 1.3270 1.3265 ( stop loss selling if breached ) 1.3230 1.3200

June EZ industrial production 0.7% vs 0.8% exp m/m

Posted: 13 Aug 2013 02:00 AM PDT

Prior -0.3%
0.3% vs 0.2% exp y/y. Prior -1.3%

August German ZEW economic sentiment index 42.0 vs 40.0 exp

Posted: 13 Aug 2013 02:00 AM PDT

Prior 36.3
Current conditions index 18.3 vs 12.0 exp. Prior 10.6.

Cable takes a little 40 pip round trip after UK price data

Posted: 13 Aug 2013 01:50 AM PDT

Down to 1.5436 then back up to 1.5476.

Inflation held steady and even though input prices came in below expectations they are still high on import costs which will underpin the main inflation rate.

UK Input price data 13 August 2013

The problem his royal Carneyness will have is if the recovery starts to be seen in wage rises and other “home grown” inflationary data points. We want consumers to spend, we want a healthy house market but it’s getting the right balance. We’re going from trying to spark life into an economy to making sure it doesn’t run away with itself.

Who’d be a central banker eh?

June UK ONS house prices 3.1% vs 3.5% exp

Posted: 13 Aug 2013 01:31 AM PDT

Prior 2.9%

UK CPI july: y/y +2.8% vs +2.8% exp

Posted: 13 Aug 2013 01:30 AM PDT

+2.9% prev
m/m 0.0 % vs 0.0% exp -0.2% prev
RPI m/m 0.0% as exp vs -0.1% prev
y/y +3.1% as exp vs +3.3% prev

All in line expectations which will be a relief to Carney & Co

Continued fall in clothing prices and footwear reduced overall gains

GBPUSD higher at 1.5463 after a pre-post dip to 1.5454

July UK PPI Input 1.1% vs 1.4% exp: Output 0.2% vs 0.2% exp m/m

Posted: 13 Aug 2013 01:30 AM PDT

Input prior 0.2%
Output prior 0.1%

Year on year

Input 5.0% vs 5.50%. Prior 4.20%. Revised to 4.0%
Output 2.1% vs 2.1% exp. Prior 1.0%.

Core output

0.1% vs 0.1% exp m/m. Prior 0.0%. Revised to -0.1%
1.1% vs 1.2% exp y/y. Prior 1.0%. Revised to 0.9%

Input prices highest since March 2012. Output highest since Feb 2013.

Still a big gap between Input and Output prices which weighs on profit margins.

UK PPI data chart July 2013

UK data coming up at the bottom of the hour

Posted: 13 Aug 2013 01:26 AM PDT

08.30 GMT brings us the main event of the morning , now that the cricket has finished a day early.

UK CPI is forecast to come in at +2.8% y/y vs +2.9% prev. The BOE inflation report predicted that the figure will stay close to that level.

We’ve had some discussion in the comments section this morning about the impact of higher inflation on the pound, and my take/rationale is that higher inflation means less chance of easing further and more likelihood of higher rates sooner it the trend continues. But therein lays a danger.

Whilst the knee-jerk reaction to a higher than expected CPI number will be GBP-positive on a yield basis my view remains that the UK needs low rates for a long while yet if it is to recover steadily. Should inflation start to creep higher and rates head higher then our chances of sustained recovery will be vastly reduced, and indeed could/would have a negative impact.

Perhaps I’m being myopic but I will sell into any decent rally on that basis.

Also coming out is UK PPI for which input is forecast to come in higher at +1.4% due to increase in oil price exacerbated by fall in GBPUSD over the month.

Full forecasts for the data can be found here