Pound (GBP) firms as autumn budget unveiled
The pound (GBP) was volatile yesterday as markets reacted to the UK autumn budget, as well as the leaked release of the Office for Budget Responsibility’s (OBR) accompanying forecast.
Sterling managed to trend slightly higher overall, as an end to the budget uncertainty and upwardly revised growth forecasts for 2025 helped fuel a modest relief rally.
The autumn budget may continue to drive GBP movement today as markets digest the plans. Sterling may slip if investors grow worried that the high tax burden could weigh on the UK economy.
Euro (EUR) subdued as market mood improves
The euro (EUR) was mixed yesterday, with the safer single currency weakening against riskier rivals and wavering elsewhere amid a risk-on market mood.
Uncertainty over the peace plan proposals to end the Russia-Ukraine war and some mixed movement in the US dollar (USD), with which EUR is negatively correlated, also contributed to the euro’s lack of a clear direction.
Expected improvements in German consumer confidence and Eurozone economic sentiment may support EUR today. Additionally, a hawkish tone in the European Central Bank’s (ECB) monetary policy meeting minutes could underpin the euro.
US dollar (USD) slips amid risk-positive trade
The US dollar fell yesterday as a cheery market mood sapped demand for the safe-haven ‘greenback’.
USD attempted to recoup some losses, thanks in part to a drop in initial jobless claims, although the ongoing risk-on mood ultimately dragged the US dollar lower.
American economic data is absent from the calendar today. As a result, market risk appetite could drive movement in the safe-haven currency.
Canadian dollar (CAD) muted by softer oil prices
The crude-linked Canadian dollar (CAD) faced some choppy movement yesterday, with the ‘loonie’ slipping against stronger peers amid ongoing weakness in oil prices.
Turning to today, Canada’s latest average earnings data is due out. If wage growth slowed in September, CAD could soften.
Australian dollar (AUD) firms amid risk-on mood
The Australian dollar (AUD) rose overnight as a cheery market mood supported the risk-sensitive ‘Aussie’.
New Zealand dollar (NZD) climbs as data beats expectations
The New Zealand dollar (NZD) strengthened overnight after retail sales in the third quarter and business confidence in November both smashed forecasts.
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