Markets Await GDP & ECB

Market movement was relatively limited with little major on the calendar ahead of key GDP figures and the ECB meeting later this week. The dollar temporarily reclaimed ground against the pound and the euro as it continued to gain on tax reform speculation. Euro-dollar held below 1.1800. Sterling-kiwi rose above 1.9000 for the first time since July 2016.

Previous Day's Market Highlights

Market movement was relatively limited with little major on the calendar ahead of key GDP figures and the ECB meeting later this week. The dollar temporarily reclaimed ground against the pound and the euro as it continued to gain on tax reform speculation. Euro-dollar held below 1.1800. Sterling-kiwi rose above 1.9000 for the first time since July 2016.
 
The MPC Member Cunliffe again made relatively dovish comments on the possibility of a rate hike next week, saying that the timing remains “open”. President Trump said he is near to deciding on the Fed, which will keep market attention on any further developments ahead of next week’s meeting.   

Currency Pairing 08:00 Today Vs 08:00 Yesterday Four-Week High Four-Week Low % Change
GBP / EUR 1.1239 1.1433 1.1069 3.18%
GBP / USD 1.3208 1.3518 1.3027 3.63%
EUR / USD 1.1756 1.1937 1.1669 2.25%
GBP/AUD 1.6943 1.7201 1.6675 3.06%
GBP / NZD 1.9053 1.9010 1.9079 3.73%
GBP / CAD 1.6703 1.6798 1.6350 2.67%

Today's Market Highlights

Eurozone PMIs were in focus this morning, with the composite and Services indices falling more than expected. This may weigh on the euro, but the releases tend to have a relatively limited immediate impact. Overall, market movement may continue to be muted ahead of GDP prints and ECB guidance later this week.  
 
In the afternoon, US Markit PMIs (13:30 BST) are forecast to have picked up in October, which may offer the dollar some support as investors look for signals of the economy’s strength as the Fed weighs what guidance to provide on the likelihood of a third rate hike this year.
 
The calendar so far for UK data has been relatively quiet, but it picks up tomorrow with the first Q3 GDP print. Data last week were mixed, and any signs that the economy has slowed in Q3 could further weigh on rate hike expectations ahead of next week’s Bank of England meeting.
 
Overnight, Australia releases Q3 inflation figures, which could see CPI hit the lower end of the RBA’s 2-3% target range. Gains may strengthen the Aussie as traders may speculate that the RBA may take a more hawkish tone if inflation continues to rise.

Today's Economic Calendar

Time Currency Release Consensus Previous
13:30 USD Preliminary Markit Services PMI (Oct) 55.6 55.3
13:30 USD Preliminary Markit Manufacturing PMI (Oct) 53.6 53.1
13:30 USD Preliminary Markit Composite PMI (Oct) 54.8
01:30 AUD Consumer Price Index QoQ (Q3) 0.8% 0.2%
01:30 AUD CPI YoY (Q3) 2.0% 1.9%