Today's Highlights
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Sterling slips back ahead of inflation data
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Reserve Bank of Australia minutes are very upbeat
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NZ service sector boosts NZD
FX Market Overview
Monday lacked market moving news, so exchange rates meandered in recent ranges. Sterling pushed higher and then fell back driven largely by intraday speculation as far as I can tell. The US Dollar slipped a little on profit taking and the markets spent their time speculating on whether the Euro-USD rate will reach a 1:1 parity level.
We did get some movement overnight however after the Reserve Bank of Australia (RBA) published its meeting minutes and they were decidedly upbeat. Rate cuts are not on the agenda at the moment and, in spite of slowing Chinese growth, the RBA is confident about the Australian economy. They did voice some concerns over the disparity between the housing markets in different areas. The AUD strengthened on this news.
New Zealand’s Dollar also strengthened after figures showed growth in the New Zealand service sector in October. The index rose from 54.2 in September to 56.3 in October and that is a significant improvement.
We will get a slew of inflation data this morning from across the Eurozone and the final Gross Domestic Product (GDP) growth figure for Quarter Three. That is unlikely to change from the previous estimate of 0.3% growth. The Euro is unlikely to be moved by the news.
From the UK, we will get inflation data for October. As you know, the Bank of England (BoE) has said it isn’t too bothered about higher inflation at this point, so anything around 1.3 to 1.5% will be considered par for the course and Sterling will tread water. However, there is a feeling that tomorrow’s unemployment and wages data will be quite upbeat, so Sterling is unlikely to decline today.
And if you think your email inbox is a problem, spare a thought for the NHS staff. Every one of them was added to a distribution list (all 1.2 million of them) and they were all emailed at the same time yesterday. What made matters worse is that a number of the recipients then asked to be removed from the list by replying to all. Gazillions of emails flooded the NHS system which slowed to a snail’s pace. Ooops.
Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
Editors’ Picks
EUR/USD holds above 1.0650 after US data
EUR/USD retreats from session highs but manages to hold above 1.0650 in the early American session. Upbeat macroeconomic data releases from the US helps the US Dollar find a foothold and limits the pair's upside.
GBP/USD retreats toward 1.2450 on modest USD rebound
GBP/USD edges lower in the second half of the day and trades at around 1.2450. Better-than-expected Jobless Claims and Philadelphia Fed Manufacturing Index data from the US provides a support to the USD and forces the pair to stay on the back foot.
Gold clings to strong daily gains above $2,380
Gold trades in positive territory above $2,380 on Thursday. Although the benchmark 10-year US Treasury bond yield holds steady following upbeat US data, XAU/USD continues to stretch higher on growing fears over a deepening conflict in the Middle East.
Ripple faces significant correction as former SEC litigator says lawsuit could make it to Supreme Court
Ripple (XRP) price hovers below the key $0.50 level on Thursday after failing at another attempt to break and close above the resistance for the fourth day in a row.
Have we seen the extent of the Fed rate repricing?
Markets have been mostly consolidating recent moves into Thursday. We’ve seen some profit taking on Dollar longs and renewed demand for US equities into the dip. Whether or not this holds up is a completely different story.
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