USD slowly extended gains for the 8th consecutive day - the longest stretch since April 2022. This momentum is driven by market adjustments in anticipation of potential rate cuts by the Federal Reserve.
The German government revised its GDP forecast for this year to -0.2% and, as a result, EUR was weaker across the board.
Earlier in the day, the Reserve Bank of New Zealand (RBNZ) communicated that concerns around economic growth could cause it to cut rates deeper. It is possible that the European Central Bank (ECB) follows suit in next week’s meeting.
Last night's release of the Federal Reserve's September minutes revealed that not all Fed members backed the 50bps rate cut decision, suggesting no sense of emergency from the Bank. As a result, USD remained supported.
*Daily move - against G10 rates at 7:30am, 10.10.24
** Indicative rates - interbank rates at 7:30am, 10.10.24
US CPI will be the key metric this afternoon, particularly for USD and whether the greenback continues its impressive recent trend – a higher core CPI number will be needed to see this happen.
We also have the minutes from ECB's September meeting when the ECB cut rates by 25 bps. However, given there wasn’t much forward guidance from the ECB in that meeting, not much is expected from the minutes. Since the S&P 500 churned out another record high yesterday, this morning's Market sentiment is positive. This also explains GBP’s moves yesterday.
Our team of currency experts are here to help you get more from your money when making international payments. We will work with you to understand your payment needs and offer specialised guidance on the best options available to you. Over the last 19 years we’ve helped over a million customers and last year alone processed over £12bn. We’re tried and trusted, and we’re ready to help you.
Have a great day.
