Pound (GBP) nudges higher ahead of autumn budget
The pound (GBP) crept higher yesterday as traders carried out some final adjustments before the UK unveils its autumn budget.
Indications that Chancellor Rachel Reeves would avoid targeting banks for extra taxation gave GBP some support, while a mild rebound in UK bond markets lifted sentiment among pound investors.
Swings in GBP are likely today as markets respond to the budget’s details. If the plans disappoint, the pound could wobble, although a brief relief rally is still possible once the uncertainty has cleared.
Euro (EUR) gains on renewed optimism over Ukraine talks
The euro (EUR) appreciated yesterday against several counterparts as hopes for progress in negotiations to end the Russia-Ukraine conflict continued to filter through markets.
This upbeat geopolitical backdrop helped the single currency shrug off underwhelming German data confirming that the Eurozone’s powerhouse economy stalled in the third quarter.
Any further movement on the peace proposal could steer EUR today. A sustained positive tone may lend the currency additional strength.
US dollar (USD) slips as expectations build for Fed rate cut
The US dollar (USD) retreated yesterday after new economic data reinforced speculation that the Federal Reserve could trim rates next month.
ADP’s weekly employment update revealed that private firms shed around 13,500 jobs per week from mid-October to early November, while US retail sales slowed far more sharply than anticipated in September.
USD may stay on the back foot today if upcoming releases land in line with forecasts. Durable goods orders are expected to show a steep cooldown, and jobless claims are projected to tick higher.
Canadian dollar (CAD) weakens as oil downturn persists
The Canadian dollar (CAD) slid yesterday, unable to resist further pressure from falling crude prices as optimism around potential Ukraine peace progress drove softer energy markets.
With another empty day on Canada’s data calendar, oil dynamics are likely to remain the dominant force behind CAD. A continued downside in crude could keep the ‘loonie’ under strain.
Australian dollar (AUD) jumps as inflation surprises to the upside
The Australian dollar (AUD) advanced overnight after Australia’s inflation rate unexpectedly climbed to 3.8% in October from 3.6%, boosting expectations that the Reserve Bank of Australia (RBA) may lean towards a more hawkish stance.
New Zealand dollar (NZD) rises as RBNZ signals end of easing cycle
The New Zealand dollar (NZD) also pushed higher following the Reserve Bank of New Zealand’s (RBNZ) policy meeting. While the central bank cut rates, it suggested borrowing costs may now be nearing neutral territory, encouraging NZD buyers.
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