Morning Report

Morning Report – Friday 22nd January

Jon Robson, Head of Trading

“The dollar has recouped some of its losses overnight however, it is still set to end the week lower. A significant event will be necessary for safe haven demand to return.”

Main Headlines

UK businesses are frustrated at missing out on hundreds of millions of pounds of support which is being blocked after the Government decided to stick with certain EU rules despite leaving the trade bloc. Helen Dickinson at the British Retail Consortium, simply called it “bizarre”.

Boris Johnson has said it is “too early” to predict when England’s lockdown will end, while some advisors believe that restaurants and pubs should not reopen until May. However, the rollout of vaccine continues to outpace other European countries giving a glimmer of hope to the U.K. hospitality sector.


The pound is lower against both the dollar and euro in trading this morning. The UK are threatening a diplomatic row with the EU after refusing to grant the EU embassy full diplomatic status, treating the bloc as an “international organisation” rather than a sovereign country. The U.K. will also release economic data on Retail sales which will likely show a very small increase in December.


The euro is mostly unchanged against the dollar in early morning trading today. The ECB policy decision was yesterday, and the central bank decided to keep the back rate and bond buying programme unchanged, which is in line with expectations. ECB officials also asked staff to propose new ways to measure financial conditions in the euro area to help facilitate decisions.


The dollar is higher against a set of major currencies including the Japanese Yen. Joe Biden unveiled a new Coronavirus strategy in his first full day in office, and warned that 100,000 Americans will probably die over the next month and continued to urge citizens to wear masks. Janet Yellen also left the door open for raising the tax rate for wealthy Americans.


Global equities are being sold off this morning as escalating Coronavirus cases dented the optimism over earnings and plans for additional stimulus. Reports that stimulus will be delayed and the UK will be in lockdown for longer than expected also dampened risk appetite, but stocks still remain near their all time high.

Main Economic Data/Central Banks/Government (All times GMT)

8:15 a.m.: France Jan. PMIs
8:30 a.m.: Germany Jan. PMIs
9:00 a.m.: ECB Survey of Professional Forecasters, Euro-Area Jan. PMIs
9:30 a.m.: U.K. Jan. PMIs
11:00 p.m.: U.K. sells bills
4:00 p.m.: EIA Crude Oil Inventory Report

Corporate Events
Earnings include Castellum, Gjensidige, Schlumberger, Reliance Industries