Morning Comment
AIB Treasury Economic Research Unit
Thursday 02 March 2017
07:45 am
Softer tone to sterling
There was a positive tone to financial market sentiment yesterday.
This partly reflected the view that President Trump had sounded a
more conciliatory tone during his address to Congress, while
reemphasising his fiscal stimulus intentions. Growing expectations
of a Fed rate hike this month also helped, as it boosted bank stocks.
The more positive risk appetite was evident on the main equity
market indices. The Euro Stoxx 50 rose by more than 2% on the
day, while in the US, the S&P 500 gained nearly 1.4%.
Meantime, most of the main currency pairs have traded in narrow
ranges over the past 24 hours. This means that the dollar has
managed to retain its slightly firmer tone. Of the modest moves
which did occur yesterday, sterling came under some downward
pressure. This coincided with a weaker than expected result from
the UK manufacturing PMI for January (54.6 vs forecast 55.5).
Today's Opening Rates
% Change
Day *
End 2016
EUR/USD
1.0535
-0.18
0.21
EUR/GBP
GBP/USD
0.8572
0.49
0.63
1.229
-0.65
-0.37
GBP/EUR
USD/JPY
EUR/JPY
1.1665
-0.49
-0.63
114.09
0.60
-2.38
120.2
0.39
-2.39
* v Previous Day's European Open
See Next Page f or M ore Rat es
Euro/US Dollar Exchange Rate
1.14
1.12
In level terms, the weaker tone to sterling was evident in cable
(GBP/USD), which moved down to below the $1.23 mark for the
first time since mid-January. The EUR/GBP pair moved up into the
upper half of the 85-86p range. Elsewhere, EUR/USD remained
pinned down around the mid-point of the $1.05-1.06 band.
1.10
1.08
1.06
1.04
In the day ahead, flash Eurozone HICP for February is the main
release of note. Inflation is forecast to have risen to 2%, while
yesterday’s firmer than anticipated German figure means there is
some potential for an upside surprise. While the ECB has indicated
that it is ‘looking through’ the recent rise in inflation, the data still
has the potential to provide some support to the euro. Dollar-wise,
a couple of speeches from members of the Fed FOMC will bear
watching as markets look to assess the degree of support for a rate
hike at this month’s meeting. Hawkish comments could see the
dollar retain the upper hand today.
Dara Turnbull, Economist, AIB
1.02
02-Sep
30-Sep
28-Oct
25-Nov
23-Dec
20-Jan
17-Feb
20-Jan
17-Feb
Euro/Sterling Exchange Rate
0.92
0.90
0.88
0.86
0.84
Opening Interest Rates
Base Rate
1-Mth
Short Term
3-Mth
12-Mth
Long Term
2-Yr
5-Yr
USD
0.625
0.81
1.09
1.79
1.64
2.10
EUR
GBP
0.00
-0.37
-0.33
-0.11
-0.15
0.13
0.25
0.26
0.35
0.73
0.59
0.83
% Changes
on Day
21115.55
+1.46
+6.85
2395.96
+1.37
+7.02
FTSE 100
7382.9
+1.64
+3.36
DJ Stoxx 50
3390.2
+2.13
+3.03
6705.05
+2.42
+2.88
19564.8
+0.88
+2.36
All Data Sourced from Thomson Reuters
23-Dec
Sterling/US Dollar Exchange Rate
1.40
1.25
1.20
1.15
02-Sep
30-Sep
All rates quoted are indicative market rates
Karl Cooke
Shane Gargan
Adrian Flanagan
Enda Homan
25-Nov
1.30
S&P 500
FX Spot
28-Oct
End 2016 to Date
Dow Jones
ISEQ
Nikkei
30-Sep
1.35
Equity Indices
Latest Close
0.82
02-Sep
28-Oct
25-Nov
23-Dec
20-Jan
17-Feb
See Next Page For More Rates & Charts
FX Options
Mark Tuite
Lenny Hogan
Equity Options James Murray
Reuters
Phone
AIBI
00353-1-7724018
Morning Comment John Fahey
[email protected]
Thursday 02 March 2017
07:45 am
Opening Levels
Euro
Sterling
Dollar
EUR/GBP
EUR/USD
0.8572
1.0535
GBP/EUR
GBP/USD
1.1665
1.229
USD/JPY
USD/CAD
114.09
1.3343
EUR/JPY
EUR/SEK
120.2
9.5302
GBP/CAD
GBP/NZD
1.6397
1.7219
USD/CHF
USD/CNY
1.0104
6.8834
EUR/DKK
EUR/NOK
7.4333
8.8747
GBP/JPY
GBP/SEK
140.22
11.116
USD/BRL
USD/RUB
3.089
58.3356
EUR/CHF
EUR/AUD
1.0644
1.3748
GBP/DKK
GBP/NOK
8.671
10.3497
USD/INR
66.7275
EUR/HKD
EUR/CAD
8.1752
1.4057
GBP/CHF
GBP/AUD
1.2415
1.6042
AUD/USD
NZD/USD
0.7658
0.7133
Change bps
121
1.20
115
1.15
109
1.10
103
1.05
02-Sep
Debt Markets
Dollar/Yen Exchange Rate
Sterling/Euro Exchange Rate
1.25
30-Sep
28-Oct
25-Nov
23-Dec
20-Jan
17-Feb
97
02-Sep
30-Sep
28-Oct
25-Nov
23-Dec
20-Jan
Daily High-Low-Close
7,300
2,350
7,100
2,300
6,900
2,250
6,700
2,200
2,150
25-Nov 05-Dec 15-Dec 25-Dec 04-Jan 14-Jan 24-Jan 03-Feb 13-Feb 23-Feb
%
1.60
Irish & German 10-Year Bond Yields
6,500
28-Nov 08-Dec 18-Dec 28-Dec 07-Jan 17-Jan 27-Jan 06-Feb 16-Feb 26-Feb
%
4 Weeks
End 16
10 Year Yield %
US
Germany
UK
2.46
0.28
1.19
+6
+8
+5
-2
-18
-25
+1
+8
-4
Ireland
Belgium
France
Italy
Spain
0.91
0.74
0.92
2.11
1.68
+5
+5
+5
+4
+5
-29
-26
-16
-19
+1
+16
+23
+25
+31
+31
Portugal
3.91
+5
-26
+18
Greece
6.70
-22
-74
-17
-----------------------------------------------------------------------------------------5 Year Swap %
US
2.06
+2
+6
+10
Eurozone
0.08
-1
-13
+1
UK
0.82
+4
-26
-6
-----------------------------------------------------------------------------------------2 Year Swap %
US
1.60
-1
+8
+16
Eurozone
-0.18
-3
-5
-2
UK
0.58
+0
-14
-2
-----------------------------------------------------------------------------------------10 Year Government Bond Spreads to Benchmark bps
Ireland
63
-3
-11
+8
7,500
2,400
Day
17-Feb
FTSE 100
S&P 500
Daily High-Low-Close
2,450
Close
Eurozone Swap Curve
Offer Rates : Money Rates to 1 Year
1.0
Belgium
France
Italy
Spain
46
64
183
139
-3
-3
-4
-3
-7
+2
-1
+19
+15
+16
+23
+22
Portugal
Greece
363
642
-3
-30
-8
-56
+10
-26
0.8
1.20
0.6
0.80
Commodities
% Change
0.4
Brent Oil
West Texas Oil
Close
56.36
53.82
Day
+1.39
-0.33
4 Weeks
-0.77
-0.15
End 16
-0.81
+0.13
CRB - All Commodity
CRB - Food
191.27
349.73
+0.34
+3.98
-1.58
+0.67
-0.65
+3.24
Gold $
1249.0
+0.03
+3.24
+8.40
0.2
0.40
0.0
-0.2
0.00
-0.4
-0.40
29-Aug
-0.6
29-Sep
29-Oct
Irish 10 Year
29-Nov
29-Dec
29-Jan
German 10 Year
28-Feb
1 Mth 3Mth 6Mth 1Yr 2Yr 3yr
Latest Close
4Yr 5yr 6Yr 7yr 8Yr 9Yr 10Yr
4 Weeks Ago
This publication is for information purposes and is not an invitation to deal. The information is believed to be reliable but is not guaranteed. Any expressions of opinions are
subject to change without notice. This publication is not to be reproduced in whole or in part without prior permission. In the Republic of Ireland it is distributed by Allied
Irish Banks, p.l.c. In the UK it is distributed by Allied Irish Banks, p.l.c. and Allied Irish Bank (GB). In Northern Ireland it is distributed by First Trust Bank. In the United States of
America it is distributed by Allied Irish Banks, p.l.c. Allied Irish Banks, p.l.c. is regulated by the Central Bank of Ireland. Allied Irish Bank (GB) and First Trust Bank are trade
marks used under licence by AIB Group (UK) p.l.c. (a wholly owned subsidiary of Allied Irish Banks, p.l.c.), incorporated in Northern Ireland. Registered Office 92 Ann Street,
Belfast BT1 3HH. Registered Number NI018800. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential
Regulation Authority. In the United States of America, Allied Irish Banks, p.l.c., New York Branch, is a branch licensed by the New York State Department of Financial
Services. Deposits and other investment products are not FDIC insured, they are not guaranteed by any bank and they may lose value. Please note that telephone calls may
be recorded in line with market practice.
AIB Bankcentre, Ballsbridge, Dublin 4
Tel: 353-1-6600311