Too Early for a Fed Pivot

Market movers today Today markets will zoom in on the FOMC meeting. It is too early to turn soft for the Fed, and we look for a 75bp hike and hawkish communication as further tightening in financial conditions is still needed. We also get October ADP Private Sector Employment out of the US, which might […]

Don't Expect Powell to Spark a Risk Rally

Jay Powell will probably hammer the dovish hopes, and the latest risk rally when he speaks following the FOMC decision today. This is, at least, what the latest economic data from the US suggests. Last Friday, the US core PCE index showed further advance in consumer prices. Though the rise was slower than analyst expectations, […]

A Fourth 75 bps Rate Hike is a Done Deal

Markets Asia’s equity scorching rally (HK more than +5%) following unconfirmed social media reports that China is preparing its exit from zero-Covid was met by a lukewarm European response. Stocks rose less than 1%. Wall Street traded opening gains for 0.2-0.9% losses. This came on the back of strong US data, going from a final […]

Aussie Climbs Despite Weak Mfg. Data

AUD/USD has posted strong gains today. In the European session, the Australian dollar is trading at 0.6424, up 0.48%. The Australian dollar rose as much as 0.80% after the Reserve Bank of Australia raised rates by 25 basis points on Tuesday, but couldn’t consolidate and ended the day virtually unchanged. Lowe urges caution The RBA […]

Bank of England Might Disappoint Amid Uncertainties about the Budget

The Bank of England will announce its latest policy decision on Thursday at 12:00 GMT in what will be its first gathering since the mini-budget debacle that sparked turmoil in global financial markets. Expectations of a super-sized rate hike have come down sharply as the panic has receded. Nevertheless, economists as well as investors are […]

GBP/USD Jumps as Sunak Takes the Reins

The pound has posted sharp gains today. In the European session, GBP/USD is trading at 1.1353, up 0.66%. Will Sunak be up to the job? Rashi Sunak is the new Prime Minister of the UK, the latest move in what has been a dizzying pace of political developments in the UK. Lizz Truss managed to […]

Bank of Japan Unlikely to Rescue the Collapsing Yen

With the Japanese yen in freefall and direct FX intervention unable to stop the bleeding, the spotlight is squarely on the Bank of Japan’s upcoming meeting on Friday. While the central bank is expected to revise its inflation forecasts higher, it is unlikely to deliver any meaningful policy changes, keeping the devastated currency under heavy […]

Canadian Dollar Rises, Markets Eye BoC

The Canadian dollar is showing some strength in today’s North American session. USD/CAD is trading at 1.3649, down 0.41%. Bank of Canada expected to hike rates by 0.75% This week’s calendar is unusually light, with only two events out of Canada. Both releases, however, could have a significant effect on the movement of the Canadian […]

Australia September CPI

Headline CPI 1.8%qtr/7.3%yr; Trimmed Mean 1.8%qtr/6.1%yr; Weighted Median 1.4%qtr/5%yr. It was a broad based upside surprise in the core measures highlighting accelerating inflationary pressures. The CPI lifted 1.8% in the September quarter with the most significant contributions coming from new dwellings (+3.7%, 0.31ppt), gas (+10.9%; 0.10ppt) and furniture (+6.6 %, 0.09ppt). Gas and furniture were […]

Yield Curves Flatten on US House Prices

Market movers today In a fairly thin data calendar today, the big event of the day is the Bank of Canada monetary policy announcement this afternoon. Markets and analysts are roughly evenly split between a 75bp and a 50bp hike. As our base case we pencil in a 50bp hike alongside a final 25bp hike […]