Following the European Central Bank’s decision to keep its Bank rate unchanged last week, the euro heads into November close to 0.5% up against the pound compared to late September.
On Friday, US personal spending rose more than expected, growing 0.7% in September, beating the market consensus of 0.4% and boosted by services and goods expenditures. This result limited the dollar’s gains against the euro as the greenback lost 0.3% on Friday afternoon.
The Bank of Russia hiked its key interest rate to 15% in its October meeting, reflecting a 200-basis point rise. This was double market expectations and signalled that monetary policy will remain elevated for a prolonged period.
The Australian dollar was on top form on Friday, gaining 0.47% against the US dollar, supported by growing expectations that the country’s central Bank will raise rates in November following hotter-than-expected inflation data.
Consumer confidence in Italy dropped for the fourth consecutive month in October to 101.6 from 105.4 in September, marking the lowest reading since January. This was considerably lower than market forecasts of 105.2.
This morning, property portal Zoopla reported house prices are falling in most parts of the UK as high interest rates put a growing strain on household wealth.
Today’s data releases will be dominated by Germany’s GDP results and inflation rate, which is expected to decline to 4.0% from 4.5% in September.
Tomorrow, investors will receive various eurozone data, with inflation rates and GDP data for the euro area, France and Italy.
On Wednesday, US data takes centre stage, with ISM manufacturing PMI, JOLTs job openings and the Federal Reserve’s interest rate decision. Markets predict the Bank will keep the rate at 5.5%.
Then on Thursday, the Bank of England’s interest rate decision is due. More on that below.
Friday is to be relatively quiet until the afternoon, when US non-farm payrolls, unemployment rate (October) and ISM services PMI will be released.
Make sure any upcoming transactions are protected against the risks of sudden market movements. Secure a fixed exchange rate now with a forward contract; call your Personal Trader on 020 7898 0541 to get started.
