Currencies

The pair rises to critical levels, building on the gains form the Fed’s dovish hold after today’s US NFPs showed the addition of just 150,000 jobs in October

The spread between the UK and US 2-year notes (top chart) remains a strong driver of GBPUSD (middle chart). The current longer correlation is an impressive 86% (bottom chart). This suggests a strong positive relationship between the spread and cable.

Watch today’s US Open for insights the two consecutive rate holds by the Bank of England and the US Fed, AMD’s return to revenue growth, key incoming events and more

Yesterday, the Federal Reserve kept interest rates on hold for a second consecutive meeting. Chair Powell recognised that inflation is slowing as opposed to emphasising how strong growth has been. Whilst keeping the door open for further hikes, there is a strong possibility that this rate hiking cycle has peaked. As such, the real yield dropped yesterday by 7.5% to close at 2.32%. It has dropped further today and is…

The pair rises past key resistances and into the Ichimoku Cloud after the Fed boost, but reaches overbought levels and now awaits next week’s live meeting by the Reserve Bank of Australia

Yesterday's European core CPI (flash estimate) came in at 4.2% y/y, which is lower than the previous 4.5 y/y, registering as a two-year low. The spread between the German and US 2-year notes also declined by about 1.5% on the day.

The pair rallied on Tuesday after the BoJ’s YCC tweak underwhelmed markets, but eases today on verbal intervention and as investors brace for the Fed’s policy decision

Watch today’s US Open for insights on the new YCC tweak by the Bank of Japan, the further deceleration of price pressures in Eurozone, key incoming events and more

Core PCE, the Federal Reserve’s preferred inflation gauge came in at 3.7% y/y, lower than the previous (and revised) month’s 3.8% y/y. On a monthly basis the reading was 0.3%, which annualises to 3.66%, which is still higher than the Federal Reserve’s target of 2%. Generally, these numbers matched market expectations.

The pair maintains its upside bias, but is cautious after the ECB paused yesterday but offered little in the way of direction, now looking to next week’s BoE decision

Watch today’s US Open for insights on the rate hold by the European Central Bank, the impressive Q3 results of Meta Platforms, key upcoming events and more