UK: Weekly FX Market Update 5 October

GBP

• UK quarterly GDP is revised up to 0.5% from 0.4%, but Sterling swoons lower still.

• PM Burnham seems focused on 2029, with promises of the triple lock and nationalization of the UK’s energy industries.

• Where does that leave Chancellor Healey in his task to balance the books and support the economy?

EUR

• Government bond markets show their concern over France’s fiscal position. Spain will now hold a surprise early election on Nov 29th.

• Bloomberg reports that the EU releases 100 million barrels of diesel from its reserves. After Trump threatened a diesel ban from the US.

• The Euro slipped lower against a still strong US Dollar. Possibly on France’s fiscal and Spain’s political worries. How long will this last?

USD

• US yields are powering higher. 30-year Treasuries now at highs not seen since 2002.

• Trump says certain levels of inflation will help pay off debt.

• Are investors pushing rates higher because of inflation expectations, or do they just want a higher term premium for lending to the US?

Mon Oct 5

09:30 EUR Sentix Investor Confidence

15:00 USD ISM Services PMI

Tues Oct 6

03:00 JPY BoJ Gov Ueda Speaks

09:30 GBP MPC Mann Speaks

10:00 EUR Retail Sales

Wed Oct 7

07:00 EUR German Industrial Production

19:00 USD FOMC Meeting Minutes

Thu Oct 8

10:15 GBP MPC Greene Speaks

13:15 GBP BoE Gov Bailey Speaks

Fri Oct 9

15:00 Prelim UoM Consumer Sentiment/Inflation Expectations