UK: Weekly FX Market Update 10 November

GBP

• Last Tuesday Chancellor Reeves Downing Street speech saw £/$ slip lower by 2.5% over 48 hours as she prepared voters for tax rises.

• The psychologically important 1.3000 level supported the pound, as well as the Bank of England (BoE) holding rates steady at 4%.

• The BoE considers that ‘CPI inflation is judged to have peaked’. Will average earnings, due for release on Tuesday, confirm or refute this?

EUR

• €/$ followed the pound around like a puppy last week, whilst ending the week quietly gaining against Sterling.

• Eurozone wages appear to be consistent with the ECB reaching its 2% target.

• Can Eurozone Flash GDP on Friday paint a positive picture for the economy and support the Euro?

USD

• The FT reports that US senators have taken the first step to ending the government shutdown.

• However, it might be a short-term fix until the end of January, reports the New York Times.

• The Supreme Court’s early comments could be interpreted that they are considering striking down ‘reciprocal’ tariffs. If so, US importers may be due $100 billion in refunds, potentially damaging for the dollar. The decision from the Supreme Court may come before Christmas.

Main events for this week:

Mon Nov 10

09:10 GBP MPC Lombardelli Speaks

09:30 EUR Sentix Investor Confidence

12:00 USD Cleveland Fed Expectations

Tue Nov 11

All Day France Canada US Bank Holiday

07:00 GBP Claimant Count Change/Average Earnings Index/Unemployment Rate

Wed Nov 12

12:05 GBP MPC Pill Speaks

15:20 USD FOMC Waller Speaks

16:30 USD FOMC Bostic Speaks

Thu Nov 13

07:00 GBP GDP/Goods Trade Balance/Industrial & Manufacturing Production

09:00 EUR ECB Economic Bulletin

10:00 EUR Industrial Production

12:00 GBP MPC Greene Speaks

Fri Nov 14

10:00 EUR Flash GDP/Employment Change/Trade Balance

14:20 FOMC Bostic Speaks