The ECB will provide stimulus until a sustained inflation rebound

European equities trade marginally lower as European and US macro data failed to give clear guidance. Major US equity indices opened marginally stronger on mixed earnings.
The ECB will provide stimulus until a sustained inflation rebound, even as its unprecedented measures come with side effects and face constraints, two policymakers said (Coeure and Lane).
Euro zone economic sentiment was much better than expected in October driven by higher optimism in industry and services. The EC's economic sentiment indicator rose to 106.3 in October from 104.9 in September, well above market expectations of a small decline to 104.8.
The American economy expanded at a 2.9% annualised rate in the third quarter, a rise from 1.4% notched in the second quarter, according to a first reading on gross domestic product from the Commerce Department. Economists expected a reading of 2.6%.
Inflation in Germany rose to its highest level in two years in October, in the latest sign of strength in Europe's largest economy. Prices rose 0.7% Y/Y in October, the fastest rate of increase since October 2014.
Shares in brewing behemoth Anheuser‐Busch InBev are among the biggest fallers in Europe on Friday morning, after its earnings missed expectations in the third quarter, dragged down by slumping demand in Brazil.
Turkey's currency has hit a fresh record low against the dollar and is still sliding this morning, after being hit with a double whammy of disappointing tourism statistics and higher inflation forecasts yesterday

KBC Market Research Desk KBC Bank

Download The Full Sunset Market Commentary

Author

KBC Market Research Desk

KBC Bank

EUR/USD hits two-day highs near 1.1820

EUR/USD picks up pace and reaches two-day tops around 1.1820 at the end of the week. The pair’s move higher comes on the back of renewed weakness in the US Dollar amid growing talk that the Fed could deliver an interest rate cut as early as March. On the docket, the flash US Consumer Sentiment improves to 57.3 in February.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold climbs further, focus is back to 45,000

Gold regains upside traction and surpasses the $4,900 mark per troy ounce at the end of the week, shifting its attention to the critical $5,000 region. The move reflects a shift in risk sentiment, driving flows back towards traditional safe haven assets and supporting the yellow metal.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid risk-off, $2.6 billion liquidation wave

Bitcoin edges up above $65,000 at the time of writing on Friday, as dust from the recent macro-triggered sell-off settles. The leading altcoin, Ethereum, hovers above $1,900, but resistance at $2,000 caps the upside. Meanwhile, Ripple has recorded the largest intraday jump among the three assets, up over 10% to $1.35.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.