Headlines:
- Dollar creeps higher as market moves are scattered
- Eurozone September preliminary CPI +10.0% vs +9.7% y/y expected
- France September preliminary CPI +5.6% vs +5.9% y/y expected
- Japan spent ¥2.8 trillion on currency intervention in the past month - MOF
- UK Q2 final GDP +0.2% vs -0.1% q/q prelim
- The fine print to today's UK Q2 GDP report
- UK September Nationwide house prices 0.0% vs +0.3% m/m expected
- OPEC+ talks said to narrow range of potential oil output cut to 0.5 to 1.0 mil bpd
Markets:
- USD leads, NZD lags on the day
- European equtiies higher; S&P 500 futures up 0.1%
- US 10-year yields down 5 bps to 3.695%
- Gold up 0.2% to $1,663.33
- WTI crude down 0.1% to $81.15
- Bitcoin down 0.2% to $19,468
With month-end and quarter-end in focus, the market moves were scattered in European trading as the initial push and pull in the dollar eventually lead to the greenback now moving higher with early gains in stocks slowly dissipating. But the bid in bonds is staying the course as yields are dragged lower again, keeping the momentum after the BOE intervention earlier in the week.
In terms of data, Eurozone annual inflation hit double-digits coming in at a record 10% reading with the core reading also jumping to 4.8% - paving the way for the ECB to be more aggressive next month.
The pound was also in focus as Truss and Kwarteng met with the OBR but did not ask the fiscal body to alter its plans, suggesting that the government isn't backing down from its economic plan. The quid was initially higher with cable moving up to 1.1235 before falling back down to 1.1030 now as dollar gains also factor into the equation amid volatile trading.
After some pushing and pulling early on, EUR/USD is settling lower being down 0.7% to 0.9740 - pushing back below its 200-hour moving average at 0.9759. That keeps the near-term bias more neutral now.
USD/JPY is little changed in general despite the dollar's advance elsewhere, as buyers are still pensive in chasing a move too close to 145.00. Something, something Icarus flying too close to the Sun.
Against the commodity currencies, the dollar's gains are more profound with USD/CAD up 0.5% to 1.3745 and AUD/USD down 0.6% to 0.6460 currently. That comes despite a slightly better appetite in the equities space, with stocks holding slight gains on the day. That said, the optimism has been watered down with S&P 500 futures now just up 0.1% after having been up by as much as 0.8% earlier.
Month-end and quarter-end trading will keep things a bit tricky before the weekend, alongside US PCE data and the UoM survey later on.
