UK: Weekly FX Market Update 22 September

GBP

GBP

• The BoE held rates steady at 4%, but sterling weakened against its peers.

• Chancellor Reeves's 'budget straitjacket' gets even tighter as government borrowing explodes in August.

• Will UK PMI data this week come to the Chancellor’s rescue, or will GBPUSD move lower and target 1.3000?

EUR

• France remains tense, with demonstrations in Paris continuing.

• The European Commission discusses a gradual path to issuing common debt.

• The Euro weakens against the USD following the FOMC's hawkish rate cut.

USD

• The Federal Reserve demonstrates its independence, following attacks from the president, gaining credibility with investors.

• As they cut rates by 0.25% to 4%, the USD strengthens, aided by better than expected weekly jobless claims.

• PMI and Final GDP could give direction this week. If they show a strong US economy, will the USD recoup some of its recent losses?

Main events for this week:

Mon Sep 22

12:45 GBP MPC Pill Speaks

15:00 EUR Consumer Confidence

17:00 USD FOMC Barkin/Hammack/Miran Speak

Tue Sep 23

09:00 EUR Flash Manufacturing & Services PMI

09:30 GBP Flash Manufacturing & Services PMI

14:45 USD Flash Manufacturing & Services PMI

Wed Sep 24

02:30 AUD CPI

09:00 EUR German IFO Business Climate

Thu Sep 25

08:30 CHF SNB Interest Rate Decision

09:00 CHF SNB Press Conference

13:30 USD Final GDP/Durable Goods

Fri Sep 26

13:30 CAD GDP

13:30 USD Core Personal Consumption Expenditure

15:00 USD Revised UoM Consumer Sentiment/Revised UoM Inflation expectations