Today's data releases
 Key levels
10.00Eurozone CPI SupportResistance
13.15Industrial productionGBP/USD1.36571.4070
14.00Michigan consumer sentimentGBP/EUR1.11861.1400

Market overview

The political roundabout which is the Trump White House may be soon to claim another victim with talk that the President’s national security adviser may soon be replaced. It should first be caveated that White House Press Secretary Sarah Huckabee Sanders has denied said reports. The Washington Post reports that Trump is ready to remove Lt. Gen. H.R. McMaster and is looking for a new national security adviser before the North Korea meetings in May. Supposedly, McMaster’s departure is being delayed whilst a strong replacement can be found, in addition to find a way for McMaster to save face. Another replacement of a key member of the White House staff would add further fuel to the fire of political uncertainty and seems to fit in with the thought that Trump is looking to move on from those who clash with him. In doing so he seems to be ensuring his team are bought into his populist agenda.


In Switzerland the National Bank yesterday kept its policy unchanged and highlighted its concerns that a rise in global trade tensions and protectionism could trigger renewed demand for the Swiss franc. Such a turn of events would be a threat to the export-dependent Swiss economy. In the meantime the National Bank said the franc was still "highly valued" and hinted that it was in no rush to start raising interest rates.

This morning an interview with ECB chief economist Peter Praet was published which suggested that the ECB is to proceed at gradual pace. He said that the Eurozone economy may have more slack than previously thought which may be slowing a rebound in inflation. All in all nothing new and further confirmation of what we’ve been hearing in recent times. In other central banker news the Reserve Bank of Australia Deputy Governor Guy Debelle said global investors are underpricing the uncertainty of the future path of interest rates, warning markets are likely to see higher volatility. Finally in Japan, Parliament’s upper and lower house quickly confirmed BOJ Governor Kuroda’s appointment and that of his new deputies.


In Brexit news European diplomats have suggested, as you would expect, that the U.K. has significant ground to make up on the Irish border issue before next week’s summit where it aims to clinch a deal on a Brexit transition period. This is certainly something to keep an eye as we look forward to next week’s EU Summit on Thursday and Friday. It is one of the major market events next week along the Fed interest rate decision and more importantly, it’s policy statement and projections. This is due out at 6pm next Wednesday. We also get the Bank of England decision and minutes on Thursday.


Data-wise yesterday it was a mixed bag as Initial Jobless Claims from the US came in bang on expectations, Continuing Jobless Claims a touch better, and the Philly Fed worse.


The day ahead

Today we’ll be watching the ‘final’ estimate of European inflation data which is due out at 10am and is expected to come in revised down a touch to 1.2% year-on-year, though the core figure is expected to be unchanged at 1%. We also have the preliminary Michigan Consumer Sentiment release from the US at 2pm. Overall it should be a quiet day for the markets with most people preferring to keep an eye on Cheltenham and more specifically the Gold Cup race at 3:30pm. Best of luck all you punters.


Thought of the day

The winter chill is back! If you were relieved to see the end of the winter storm and packed away all your winter clothes, then I am really sorry to break this news... Britain’s weekend weather forecast sees the cold and snow back again. This unpredictability shouldn’t be too much of a surprise; after all we are used to seeing 4 seasons in one day! Our unpredictability doesn’t stop here, our politics in recent years has certainly provided us with a  few surprises and the recent Brexit negotiations haven’t failed to end the uncertainty. Next week is set to be crucial for Brexit negotiations. David Davis is meeting with his EU counterpart Michel Barnier on Monday to flesh out the final details of an agreed transition period. And later in the week (22-23 March), EU leaders will meet at their Summit later where they will negotiate principles for trade talks. Will our Government secure us the transitional deal that we are seeking? To get further insight into this join our UK chief economist, Philip Shaw on his conference call on 20 March 10:00 GMT. 

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