UK: Weekly FX Market Update 24 November

GBP

• After a long build up, will the budget on Wednesday give Sterling direction until year end?

• While voters may not like possible tax hikes, will the gilts market gives the Chancellor a ‘thumbs up’, strengthening the pound?

• Or will Rachel Reeves upset the markets and see GBPUSD crash below 1.3000?

EUR

• While the Euro trades quietly, it has moved lower by 2.5% since its September high.

• Will the US peace plan for the Ukraine-Russia war gain traction and support the Euro?

• Can German CPI on Friday encourage more stability for the Euro?

USD

• Bloomberg analysts have reduced the Federal Reserve’s chances of a December rate cut in three weeks from 99% to 35%.

• Whilst President Trump knows his preferred Fed Chair candidate, is it possible that whoever is chosen will have a dovish outlook on interest rates?

• US GDP on Wednesday could add more colour to the path for the US economy and US Dollar.

Main events for this week:

Mon Nov 24

15:00 EUR ECB President Lagarde Speaks

Tue Nov 25

13:30 USD Retail Sales

Wed Nov 26

00:30 AUD CPI

05:00 JPY Core CPI

12:30 GBP UK Budget

13:30 USD GDP/Unemployment Claims/Durable Goods

15:00 USD Core PCE Price Index

Thu Nov 27

All Day US Holiday

12:00 GBP 30-Y Bond Auction

16:00 GBP MPC Greene Speaks

23:30 JPY Tokyo Core CPI

Fri Nov 28

07:00 EUR German Prelim CPI

13:30 CAD GDP