Happy US thanksgiving! US markets may see thin trading activity due to the holiday, with the DXY index starting the day around 106.50.
Recent US data showed solid growth in consumer spending for October but showed stagnation in lowering inflation. PCE increased by 2.3% YoY in October, up from 2.1% in September. Core PCE rose by 2.8%, slightly higher than the 2.7% from the previous month.
EURUSD trades at 1.0540 at the beginning of the session ahead of Germany inflation data later today.
Friday’s Eurozone HICP inflation data is projected to show annualized increases for both headline and core inflation in November, which may cause market unease ahead of the ECB meeting in December.
Cable remains near 1.2650 as the US dollar picks up demand from safe haven support and month-end flows.
With a sparse economic calendar for the next week, the pound will be largely driven by US market sentiment and market expectations around the BoE interest rate decision next month.
World News
Since news of proposed 25% US tariffs for Mexico, Donald Trump recently met with Mexican President Claudia Sheinbaum. The USDMXN pair fell 0.9% to 20.40 after “very productive” talks concerning migrants and drug flows.
