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Home > Market Watch > EU & UK News > Thu November 2, 2023

Daily Insights
November 2, 2023

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  • As widely expected, the US Federal Reserve’s FOMC lefts its benchmark interest rate unchanged yesterday in a range of 5.25% to 5.5%, holding off raising interest rates for a second consecutive policy meeting. At his post meeting press conference Chairman Jerome Powell hinted that the committee may now be finished with the most aggressive tightening cycle in decades. “The question we’re asking is; Should we hike more?” adding, “Slowing down is giving us, I think, a better sense of how much more we need to do, if we need to do more.” Equity markets applauded Powell’s dovish pivot with the S&P 500 closing over 1% higher, treasury yields tumbled, and the greenback lost ground against its G10 peers. The announcement came after a softer than expected ADP Private payroll release and a big drop in the ISM Manufacturing Index which fell the most in a year.

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  • The single currency was able to rally a touch against the greenback however EURUSD is once again struggling to significantly breach the 1.06 area. Downside risk remain in place with support seen around 1.0520 and on the topside 1.0660 remains stubborn resistance. Later today we await the final reading of Eurozone Manufacturing PMI data for October which is expected to come in unchanged at a disappointing 43.0.

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  • The pound is treading water ahead of the BoE meeting later today, with cable once again hovering around the 1.22 area. The MPC is expected to keep interest rates unchanged at 5.25% for the second consecutive meeting, leaving the benchmark rate at its highest level since 2008. Market speculation suggests that the next move in interest rates will be a cut, but probably not until the second half of next year.

Economic Calendar

02 Nov 2023
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AUD - Goods Trade Balance
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JPY - 10-y Bond Auction
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CHF - CPI m/m
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EUR - French Gov Budget Balance
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CHF - SECO Consumer Climate
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EUR - Spanish Manufacturing PMI
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EUR - Italian Manufacturing PMI
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EUR - French Final Manufacturing PMI
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EUR - German Final Manufacturing PMI
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EUR - German Unemployment Change
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EUR - Final Manufacturing PMI
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EUR - Spanish 10-y Bond Auction
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EUR - French 10-y Bond Auction
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USD - Challenger Job Cuts y/y
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GBP - BOE Monetary Policy Report
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GBP - Monetary Policy Summary
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GBP - MPC Official Bank Rate Votes
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GBP - Official Bank Rate
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GBP - BOE Gov Bailey Speaks
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USD - Unemployment Claims
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USD - Prelim Nonfarm Productivity q/q
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USD - Prelim Unit Labor Costs q/q
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USD - Factory Orders m/m
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USD - Natural Gas Storage
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CHF - SNB Chairman Jordan Speaks

Market Indicators

Currency Pairs
Pair High Low
eur/gbp 0.87021 0.86893
gbp/usd 1.21964 1.21771
gbp/aud 1.89807 1.89372
gbp/nzd 2.07308 2.0678
usd/jpy 150.592 150.15
eur/usd 1.06021 1.05837
gbp/jpy 183.456 183.05
eur/cnh 7.77079 7.7543
usd/cnh 7.33214 7.31808
Equities and Commodities
Nasdaq 100 14719.9
DOW 33271.2
S&P 500 4246.6
BRENT CRUDE 85.35
WTI 81.15
GOLD 1984.96

This document is for information purposes only and does not constitute any recommendation or solicitation to any person to enter into any transaction or adopt any trading strategy, nor does it constitute any prediction of likely future movements in exchange rates or prices or any representation that any such future movements will not exceed those shown on any illustration. All exchange rates and figures appearing are for illustrative purposes only. You are advised to make your own independent judgment with respect to any matter contained herein.

About Simon Walker

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Simon Walker is head of the GPS Capital Markets trade desk in our London office where he is responsible for covering market risk in European hours. He has over 25 years’ experience in foreign exchange, working in both sales and trading.

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