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XTB TRADEBEAT

Data sinks GBP and boosts USD; Bitcoin retreats from record high

Summary:

  • GBP extends recent declines following CPI release
  • Strong retail sales provide boost for USD
  • Bitcoin retreats after making fresh all-time high

Today’s biggest moves in the markets have come off the back of data releases with the UK CPI setting the ball rolling this morning.  The latest inflation data has given the BoE a little more wiggle room after the CPI Y/Y for July showed a smaller than expected increase. The rise of 2.6% is lower than the consensus forecast for a 2.7% rise and inline with the prior print. Today’s print marks the second successive lower than expected number for this widely viewed measure of inflation and the strong rise seen since the start of the year appears to have been halted.

Inflation data released from Sweden also caused a stir for the Krona causing the currency to rise to its highest level in 5 months.  The latest data on inflation showed a 2.4% rise Y/Y for the past month which was substantially higher than many forecasters predicted. Despite Sweden’s booming economy the central bank have been reluctant to hike rates with inflation stubbornly persisting below the 2% target.

The latest retail sales data from the US has come in better than expected with both the headline and core readings beating forecasts. The headline reading showed a 0.6% increase m/m for the month of July which was substantially higher than the 0.3% expected. The beat ends a sequence of 5 successive misses for this data point and comes as a surprise to the upside for the US economy.

Another day another all-time high for Bitcoin. The incredible surge of the most widely traded cryptocurrency continued today as the price of Bitcoin added to recent gains to post yet another record peak. However after reaching a high of 4420 there has been some notable weakness in the market and a wave of selling has hit. 

The fortnightly auction by the Global Dairy Trade (GDT) has shown a slight drop in what is seen as an international benchmark for milk prices. The price index was $3339 USD/MT, FAS. The latest drop of 0.4% in small compared to the prior reading of -1.6% but is a drop nonetheless. A daily chart of the NZDUSD shows that market has been in a fairly clean downtrend for the past couple of weeks after peaking at 0.7555 towards the end of July

 

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