15 January, AtoZForex.com, Lagos – US unemployment claims released yesterday, showed 284k individuals filed for unemployment insurance for the first time during the past week, surpassing forecast of 275k individuals. For the day, we have the US dominating with several high impact news scheduled for release, one of which is the US retail sales data to drive USD today.
Aside USD, the Australian dollar remains one of the biggest losing G10 currencies this year so far, dragged down by China worries. The positive Australian jobs report yesterday, showing unemployment rate down to 5.8% from 5.9% did not do much to give the currency a sustained boost. It is also joined by the likes of the New Zealand dollar and the Canadian dollar, which have all lost strongly against the dollar in recent weeks on global macro economic issues.
UK economic appraisal
The Bank of England maintained interest rate at around seven year lows at 0.5% and that doesn’t look set to change any time soon. The central bank has shown concern over the slump in oil, worries about China, mounting risks from the U.K.’s European Union referendum and the World Bank cut in growth forecasts. Adding to worries of the BoE, we have a downward revision to past gross domestic product growth, a cooling in services and a slump in industrial production suggest the economy, while growing, may be losing a bit of momentum. As of November, inflation was at 0.1 percent, putting is well below the BoE’s 2 percent target. An with the plunging oil prices, this is unlikely to pick up anytime soon. However, the pound has declined against all but two of its 16 major peers since Dec. 10 and is at its lowest since 2010 against the dollar. This could help cushion the effect of the other ailing conditions.
US retail sales
Consumer spending has been impressive enough to satisfy the Fed. The November figures showed US retail sales climbed by the most in four months as American consumers put to work some of the money saved from the cheapest gasoline since early 2009. The strong labor conditions which have enabled millions of people to get back to work, consequently boosting disposable income has also put more money in the pockets of households. However, last month’s retail sales figure and core retail sales are now forecast to come in at -0.1% and 0.2% respectively.
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