ECB, Politics & GDP Figures to Drive Markets

Sterling rallied on Friday after seeing pressure for much of the week as traders took profit and as EU leaders said that while not enough progress had yet been made to undertake formal trade negotiations, informal preparations could begin. Markets viewed this as a small positive step, although progress is expected to remain slow.

Previous Day's Market Highlights

Sterling rallied on Friday after seeing pressure for much of the week as traders took profit and as EU leaders said that while not enough progress had yet been made to undertake formal trade negotiations, informal preparations could begin. Markets viewed this as a small positive step, although progress is expected to remain slow.  
 
The dollar has gained recently on speculation that President Trump could appoint a hawk as the Fed chair when Yellen’s term expires next year and as Trump has said Yellen remains in consideration for re-appointment. The greenback rallied last week after the Senate’s budget approval, which investors viewed as possibly paving the way for tax reform.
 
The euro has come under pressure on heightened tensions in Spain following the Catalan independence referendum. The kiwi dollar has been under pressure since the Labour Party gained enough support to form a government. Sterling-kiwi has risen to around its highest levels this year.

Currency Pairing 08:00 Today Vs 08:00 Yesterday Four-Week High Four-Week Low % Change
GBP / EUR 1.1225 1.1433 1.1069 3.18%
GBP / USD 1.3199 1.3572 1.3027 4.02%
EUR / USD 1.1759 1.1937 1.1669 2.25%
GBP/AUD 1.6871 1.7201 1.6675 3.06%
GBP / NZD 1.8910 1.9010 1.8367 3.38%
GBP / CAD 1.6671 1.6798 1.6350 2.67%

Today's Market Highlights

Amidst a relatively quiet economic calendar today, attention will largely be on politics, particularly any further developments in Spain. Any further exacerbation of tensions could put additional pressure on the euro.
 
Otherwise, market movement may be relatively limited today as investors wait for key events later in the week. The euro may pick up as investors anticipate greater clarity from the ECB on the next move on winding down the QE programme when it announces its latest policy decisions on Thursday.
 
Other highlights include the first estimate of Q3 GDP from both the UK and the US. The Bank of Canada is expected to keep interest rates on hold on Wednesday.

Today's Economic Calendar

Time Currency Release Consensus Previous
24hr NZD Labour Day
11:00 GBP CBI Industrial Trends Survey - Orders MoM (Oct) 9 7
13:30 USD Chicago Fed National Activity Index (Sep) -0.10 -0.31
13:30 CAD Wholesale Sales MoM (Aug) 0.6% 1.5%
15:00 EUR Preliminary Consumer Confidence (Oct) -1.1 -1.2