Markets are weighing BoE rate cut prospects against sticky inflation and muted growth, leaving GBP outlook nuanced despite yesterday’s calm in gilt markets, Rabobank's FX analyst Jane Foley reports.
This week’s US Dollar (USD) pullback reflects Fed-driven rate expectations rather than geopolitical shifts, while thinner Thanksgiving liquidity may set the stage for potential USD/JPY intervention, ING's FX analyst Francesco Pesole notes.
The Jpanese Yen (JPY) has continued to trade at weaker levels during the Asian trading session alongside the US dollar which has corrected lower in response to dovish comments from New York Fed President Williams who signalled he still sees room for another rate cut in December.
The UK budget lifted Pound Sterling (GBP) modestly as fiscal pressures eased, but back-loaded tax measures and upcoming BoE rate cuts could keep the currency’s upside limited, ING's FX analyst Chris Turner notes.
An early release of the UK budget report revealed more balanced tax increases and moderated growth forecasts, calming markets, but long-term spending plans leave fiscal questions unresolved, Commerzbank's FX analyst Michael Pfister notes.
USD/JPY faces resistance near 157.90, with a brief bounce possible, but failure to clear this level could extend the recent pullback toward 154.40–152.80, Société Générale's FX analysts note.
USD/JPY has started to ease lower in recent sessions, taking cues from a shift in BOJ rhetoric. The timing of the shift appears to coincide with Takaichi-Ueda meeting last week. USD/JPY was last seen at 156.30 levels, OCBC's FX analysts Frances Cheung and Christopher Wong note.
The Dollar Index (DXY) gaps as markets price an 80% chance of a December Fed cut, extending the shift in Fed rhetoric, OCBC's FX analysts Frances Cheung and Christopher Wong note.
The Euro could extend gains if Ukraine peace talks deliver a breakthrough, though negotiations may continue into next week. EUR/USD’s return to 1.16 opens room toward 1.17–1.18, ING's FX analyst Francesco Pesole notes.
The Pound Sterling (GBP) staged a relief rebound yesterday after the UK government released details of their own budget. There was initial relief amongst market participants that the Autumn Statement did not trigger a sell-off in the gilt market.
The Euro hesitates near monthly lows, following a sharp reversal after the release of the UK Budget on Wednesday. The pair has found some support at 0.8745 earlier on the day, but is lacking acceptance above 0.8760, and looks likely to extend its reversal, aiming for the 0.8720 area.
USD/CAD extends its losses for the third successive session, trading around 1.4030 during the Asian hours on Thursday. The daily chart’s technical setup reflects a persistent bullish bias, with the pair remaining within its ascending channel pattern.
The NZD/USD pair is building on the previous day's post-Reserve Bank of New Zealand (RBNZ) move up and gaining strong follow-through positive traction on Thursday.
Noguchi’s neutral tone softens expectations for a December move, reinforcing a cautious BoJ path that keeps yen traders focused on wage data, currency volatility and the December meeting’s communication.
Watch the full chart walkthrough in today’s video as we examine AMD’s trend line reclaim, the recent double bottom, and the line in the sand at $198.30 that separates recovery from renewed downside.
Auld’s call leans hawkish relative to market expectations, suggesting upside risks for front-end AU yields and a potential floor under the AUD if growth surprises on the upside.
The mix of a dissent and three members open to cuts tilts the BoK’s bias mildly dovish, keeping downward pressure on front-end yields while FX stability remains a crucial variable for policy.
Hawkesby says further rate cuts would require a major shift in the outlook, effectively marking the end of the easing cycle. He warns too much dovishness risks keeping inflation stuck near 3%, and says current projections support holding the OCR steady through next year.
Noguchi says the BoJ will only dial back stimulus gradually and only if demand and wages strengthen enough to anchor inflation. He warns some price pressures could reappear due to delayed cost pass-through, notes limited tariff impact so far, and says policy adjustments should track the BoJ’s projected inflation timeline.
Hawkesby with more, says RBNZ policy is now clearly stimulatory and could fuel a stronger-than-expected recovery, but warns excessive caution among firms and consumers remains a risk. He also highlights global threats to central-bank independence and says the NZD is buffering the economy.
The EUR/USD registers back-to-back bullish days boosted by speculation that the Federal Reserve might cut rates at the December meeting, following the release of a strong jobs report. At the time of writing, the pair trades at 1.1595, up 0.22% after bouncing off daily lows of 1.1547.
The Fedspeak shift has very firmly reinforced market conviction in a December cut, supporting front-end duration and keeping downward pressure on the USD, especially against higher-yielders.
Gold (XAU/USD) rises sharply on Wednesday, edging up over 0.80% sponsored by falling US Treasury yields and a weaker US Dollar, as the odds for a rate cut by the Federal Reserve (Fed) remain elevated despite strong economic data in the US.
Most Fed districts report little change in economic activity, with some noting risk of slower growth. Manufacturers optimistic, wages growing at moderate pace. Prices rise moderately.
The RBNZ cut by 25 basis points, but expectations have firmed that this will be the final rate cut from the Reserve Bank of New Zealand leading to a sharp move higher
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