- The euro trades in a narrow range this morning, hovering around 1.05 (key support) against the greenback as European investors wait for German data later this morning, which will set a tone to Friday’s Eurozone CPI. Germany’s CPI YoY in September is expected to drop to 4.5%, vs. prior 6.4%. Spain’s CPI YoY for September has just been released at 3.2%, vs. 3.3% estimate and above prior 2.6%. Spain’s core CPI coming in at 5.8%, vs 6.0% gives support for the view that the ECB is done hiking rates, which should be put some further pressure on the euro.
- GBP/USD is steady above 1.21 this morning but it can be drawn towards 1.22 as month-end kicks in and a lot of option strikes expire at that level today. Any move to this level will be short-lived, if you think about it, combining a dovish Bank of England with a hawkish Federal Reserve will keep the bears alive on the pair.
- USD/JPY heads lower and trades mid 149-150 after Japan’s Finance minister stated that financial authorities will take appropriate measure in case there are abusive currency moves, suggesting a potential intervention in the Yen should the currency depreciate.
- US GDP QoQ is due later today, with the survey suggesting a 2.2% increase, from the previous 2.1%. Personal Consumption is also due, estimated to remain at current levels of 1.7%.
- US benchmark oil reached $95 per barrel, the most in a year, after US’s stockpiles in one of the major storage hubs register a drop, stressing the current global supply deficit. Inventories at Cushing, fell below 22 million barrels.