Key Headlines:

·        GBP Weakens Further as Markets Await Inflation Data

·        EUR Strengthens Following Hawkish Remarks
 

Yesterday Recap

·        GBP Weakness Persists Ahead of CPI Data: The pound extended its decline from Friday, underperforming across the board as markets turned their focus to tomorrow’s inflation figures.

·        JPY Leads Losses in G10: The Japanese yen saw the steepest decline among G10 currencies after Bank of Japan Governor Kazuo Ueda adopted a neutral tone regarding further interest rate hikes.

·        EUR Gains on Hawkish ECB Remarks: The euro strengthened yesterday, supported by ECB member Joachim Nagel’s comments suggesting that trade wars could drive inflation higher, potentially justifying further rate increases.

Today’s Rates

Today's Interbank Rates at 09:55 am against GBP movement.

GBP>EUR – 1.1974

GBP>USD – 1.2628

EUR>GBP – 0.8354

EUR>USD – 1.0549

GBP>CAD – 1.7717

GBP>AUD – 1.9462

GBP>SEK – 13.865

GBP>AED – 4.6380

GBP>HKD – 9.8300

GBP>ZAR – 22.873

GBP>CHF – 1.1160

GBP>PLN – 5.1835

Today’s Key Takeaways

Key Events for EUR and CAD Today:

·        The euro is in the spotlight with October’s final CPI data due at 10 AM.

·        Canada’s CPI report, scheduled for the afternoon, could influence rate expectations, potentially shifting between a 25bps or 50bps rate cut in December.

GBP Focus on Tomorrow’s CPI Data:

·        Tomorrow’s UK inflation figures are critical in determining the likelihood of a December rate cut by the BoE.

USD Outlook and Hedging Strategy:

·        With USD showing signs of consolidation this week, any upside surprise in UK CPI and subsequent GBP strength may present an opportunity for clients to hedge against future USD requirements, as the longer-term outlook remains USD-positive.

19^th November 2024

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