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Improving sentiment as tensions ease with focus beginning to shift towards the latest corporate financial updates, see US equity futures pointing to another positive open (NASDAQ 100 +1%, DJIA +0.9%, S&P 500 +0.6%). Banking heavyweight Goldman Sachs reported their earnings this morning in which they beat market estimates across the board, while Netflix shares are up 7% pre-market after they noted that monthly subscribers significantly ahead of expectations.

USD: The USD-index has seen a modest rebound this morning and as such has consolidated above 89.00 following softer Eurozone data. Alongside this, US Treasury Secretary Mnuchin provided clarity on yesterday’s FX comments by President Trump, having stated that Trump gave warning shots to Russia and China on currency devaluation, subsequently providing an additionally boost for the greenback.

GBP: Overnight, saw GBPUSD print fresh post-Brexit highs at 1.4377, however, today’s employment report took the shine out of the bullish momentum with the pair back down to 1.4330. Focus on the wage component, which missed analyst estimates of 3%, printing at 2.8%. However, the average weekly earnings ex bonus outstripped inflation for the first time in a year (2.8% vs. 2.7%), subsequently ending the consumer squeeze, while the unemployment rate dropped to the lowest level since 1975 at 4.2%. Overall, the report was generally positive and likely to keep the Bank of England on track to raise rates next month. Dip buying likely to keep GBP supported, levels on the upside for GBPUSD is now the intra-day high at 1.4377 for a test of the psychological 1.4400 handle.

EUR: Extended run of weak Eurozone and German data continues with the Euro on the back foot after the latest Eurozone ZEW survey fell sharply to the lowest level since November 2012 as ongoing trade disputes and the recent actions in Syria weighed on business sentiment. As such, the Euro’s climb to 1.2400 had been brief and is now trading around intra-day lows of around 1.2350. This is also likely to keep the bearish momentum on EURGBP going, however, the 0.8620-30 support zone has been curbing any further declines in the cross.

AUD: RBA meeting minutes offered little to no new insight into the committees view on monetary policy and thus supporting the case that the RBA are unlikely to raise rates this year. Elsewhere, Chinese GDP grew in line with expectations at 6.8%, however industrial production had missed economic forecasts, consequently AUD bulls stalled just ahead of 0.7800.

DailyFX Economic Calendar: Tuesday, April 17, 2018 – North American Releases

US AM Digest: GBP Falls as Wages Miss Expectations; Momentum Remains Bullish

US and Canadian data now out of the way for today with focus on shift towards any trade or geopolitical related headlines, alongside another slew of central bank speakers. Fed’s Quarles (Voter) will testify before the House Financial Services Panel at 14:00GMT, later at 15:00GMT we will see comments from Fed’s Harker (Non-Voter) and finally Fed’s Evans (Non-Voter) will speak on the economic outlook at 17:10GMT.

DailyFX Webinar Calendar: Tuesday, April 17, 2018

US AM Digest: GBP Falls as Wages Miss Expectations; Momentum Remains Bullish

Five Things Traders are Reading

  1. DXY Index Recoups Overnight Losses on Weak Data out of Europe” by Christopher Vecchio, Senior Currency Strategist
  2. Trading Outlook – S&P 500, Dow, Nasdaq, Crude Oil, Gold/Silver & More” by Paul Robinson, Market Analyst
  3. EURGBP Nudges Higher; Ignores Weak EZ Sentiment Data” by Nick Cawley, Market Analyst
  4. GBPUSD Slips Despite Record Employment Figures” by Justin McQueen, Market Analyst
  5. DAX Chart Outlook – Overhead Levels to Watch; Big-picture Top Forming?” by Paul Robinson, Market Analyst

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-- Written by Justin McQueen, Market Analyst

To contact Justin, email him at Justin.mcqueen@ig.com

Follow Justin on Twitter @JMcQueenFX