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The pound starts the week over 1% lower against the US dollar
After embarking on a downward cycle last week, the pound started the European session close to 2% lower against the US dollar and 0.2% lower against the euro since last Monday.
Overall, the pound’s monthly gains still stand against the euro, coming in 1% higher than in early September. If you wish to lock in today’s rate with a forward contract, call your account manager today on 020 7898 0541 to protect your upcoming transactions from unforeseen market movements.
Staying true to his former sentiment, chief economist of the Bank of England Huw Pill warned on Friday against cutting UK interest rates “too far or too fast”, the day after bank governor Andrew Bailed, said the central bank should move “more aggressively” to lower borrowing costs.
The FAO World Food price index increased by 3% in September to 124.4 reflecting the largest month-by-month increase since March this year and the highest level since July 2023. Prices of sugar soared by over 10% while prices of vegetable oils jumped 4.6% to an 18-month high.
The US economy added 254,000 jobs in September, much higher than the upwardly revised figure of 159,000 in August and well above forecasts of 140,000. This is the strongest JOLT growth in six months and higher than last year’s average monthly gain of 203,000.
The US unemployment rate fell to 4.1% in September, down from 4.2% the previous month and lower than market expectations of 4.2%.
Here’s what to look out for this week…
There is little high-level data to look out for today bar a few Fed speeches. Tomorrow brings the balance of trade for Canada and the US. On Wednesday, German balance of trade figures will be released followed by FOMC minutes from the Fed.
Thursday is the day to watch though, with US core inflation and headline inflation due just after lunch in the UK.
Closing the week, we have German inflation and core inflation, UK GDP figures for August and the University of Michigan’s consumer sentiment stats for October, following an increase in September.
Make sure any upcoming transactions are protected against the risks of sudden market movements. Secure a fixed exchange rate now with a forward contract; call your account manager on 020 7898 0541 to get started.
GBP: UK house prices soar 4.7%
The Halifax House Price Index in the UK increased 4.7% in September, the most since November 2022, following a 4.3% rise in August. Compared to last month, house prices increased by 0.3%, above forecasts of 0.2%, bringing the average property price up to £293,399.
GBP/EUR past year:
EUR: German factory orders fall
Factory orders in Germany shrank 5.8% month-on-month in August, compared with market forecasts of a 2% fall and after 3.9% growth a month prior. This is the steepest decline since January and is largely due to big-scale orders for aircraft, ships and trains.
EUR/USD the past year:
USD: Dollar shows strength against yen
The Japanese yen lost around 3% last week as top officials tempered expectations on additional rate hikes. The yen came under additional pressure early last week as strong US economic data suggested the Federal Reserve does not have to be as aggressive with rate cuts moving forward.
USD/GBP past year:
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