UK: Weekly FX Market Update 13 October

GBP

• The Pound lost ground last week as the market showed its concern over the UK’s fiscal position.

• Will employment data on Tuesday give Sterling some support?

• Or will claimant count data push higher again, continuing to show a slowing economy?

EUR

• French politics is causing investors some concern with the returning Prime Minister unable to balance the budget. The PM has until Monday, 13th Oct to present the draft budget bill.

• According to The Times, after accounting for taxes, social contributions and transfers, the average income for pensioners over 65 is higher than for working-age individuals.

• ZEW economic sentiment, industrial production and final CPI could also give direction this week.

USD

• The dollar traded higher at levels not seen since July.

• Are investors turning bullish on the USD?

• Or with possibly two more US rate cuts to come this year, a Supreme Court judgment starting on Trump’s tariffs on November 5th and a possible re-escalation of the US-China trade war, is this a short-term correction before the weakness returns?

Main events for this week:

Mon Oct 13

All Day Holidays- US, Canada, Japan

17:10 USD FOMC Paulson Speaks

Tue Oct 14

07:00 GBP Average earnings/Claimant Count Change/Unemployment Rate

10:00 EUR ZEW Economic Sentiment

13:00 GBP MPC Taylor Speaks

13:45 USD FOMC Bowman Speaks

14:30 USD Fed Chair Powell Speaks

18:00 USD BoE Gov Bailey speaks

Wed Oct 15

02:30 CNY CPI

09:00 GBP MPC Ramsden Speaks

10:00 EUR Industrial Production

13:30 USD CPI- Possibly Delayed

16:00 GBP MPC Breeden Speaks

Thu Oct 16

07:00 GDP/Goods Trade Balance/Industrial Production

13:30 USD PPI/retail Sales/Unemployment Claims -Possibly Delayed

13:30 USD Philly Fed Manufacturing Index

14:00 GBP MPC Mann Speaks

14:00 USD FOMC Waller Speaks

17:00 USD ECB Lagarde Speaks

19:30 GBP MPC Greene Speaks

Fri Oct 17

10:00 EUR Final CPI

10:35 GBP MPC Pill Speaks

13:30 USD Unemployment Claims- Possibly Delayed

13:30 USD Employment Data- Possibly Delayed

14:15 USD Industrial Production/Capacity Utilisation

17:00 GBP MPC Greene Speaks