Heavy US data, the Presidential campaign and the closing of a volatile trading month will all contribute to an uncertain week ahead..
| GBP
| The Pound is set for the biggest 4-week drop in a year versus the USD, as investors flock to the safe-haven currency amid both political and economical choppy waters.
On Wednesday, we will witness the first Labour Budget in 14-years and it's one that has garnered a lot of attention. No-one is expecting a GBP meltdown like we saw with Liz Truss' aborted mini-budget of 2022, but it certainly is a high-stakes budget nonetheless that could have big ramifications for financial markets..
Finance Minister Rachel Reeves wants to change the measure of public debt that the Government targets, to allow for more money in borrowing for investment. There will be winners and and there will be losers as far as consumers are concerned come Wednesday, but the initial reaction will be from traders and investors in how they interpret the debt rule change and this will move Sterling.
GBP v EUR has been somewhat unmoved by US events and the UK Budget thus far, which just highlights traders and investors are more focused on BoE v ECB on interest rates, as-well-as the psychological barrier of 1.20 when it comes to open positions.
EUR The Euro has the potential of creating some movement of its own this week with inflation data. Last time out, both the Spanish & German readings sunk the Euro as inflation fell quickly below the 2% target. Let's see if the same plays out and all-but-confirms near-term interest rate cuts from the ECB (creating € weakness) or whether the inflation position has improved slightly which may bump the Euro.
USD The Dollar is going from strength to strength and is likely to outperform this week too. Markets are mainly 'nervous' ahead of the US Presidential vote next week and when this happens, risk-off mood occurs. The latest odds are showing a 60% chance of a Trump victory and we expect the Dollar to gain both near and long term versus all currencies if this should happen.
Before that though, arguably the marquee driver this week is the US jobs release. October has seen a more robust US economy after wobbling somewhat the previous few months and a strong labour market could delay further interest rate cutting from the Fed, which would then strengthen the Dollar further.
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Expected mid-market ranges for October 28th 2024 | | |
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Upcoming Data | Monday 28th October 2024 | N/A
| Tuesday 29th October 2024 | 12:30 US - Goods trade balance 14:00 US - Consumer confidence & job openings |
Wednesday 30th October 2024 | 06:30 EU - French consumer spending & GDP 08:00 EU - Spanish inflation 08:55 EU - German unemployment 09:00 EU - Italian GDP 09:00 EU - German GDP 10:00 UK - Autumn forecast statement 10:00 EU - Euro-Zone consumer confidence & GDP 12:15 US - Non-Farm employment change 12:30 UK - Spring statement 12:30 US - GDP 13:00 EU - German inflation 14:00 US - Pending home sales
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| Thursday 31st October 2024 | 07:00 EU - German retail sales 07:45 EU - French inflation 10:00 EU - Italian & Euro-Zone inflation & unemployment rate 12:30 US - Initial/continuing jobless claims, personal income/spending & PPI 20:30 US - Feds balance sheet |
| Friday 1st November 2024 | 06:45 EU - French Government budget balance 12:30 US - Average earnings, non-farm payrolls & unemployment rate 14:00 US - Manufacturing PMI
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