Daily Update - 30th October 2018
The FX market traded in quite a dull fashion this Monday, with the greenback appreciating against most of its major rivals Euro reaching such low after German's Merkel coalition CDU ruling party lost another regional election, this time in Frankfurt. The dismal result has jeopardized Merkel's party leadership, and there were headlines suggesting that she won´t run back to lead the party and ever resign to do so. The most relevant event of the day was UK's Chancellor Phillip Hammond presenting the kingdom's budget. Among his opening remarks, he said "the era of austerity is over," among other encouraging statements that clearly failed to motive Pound's bulls, more concerned these days about the effects of Brexit on the UK economy, and Hammond words over the weekend, claiming that a no-deal Brexit will need adjustment to this budget For the EUR, it’s a busy day ahead, with key stats scheduled for release including prelim October inflation numbers out of Spain, France and Germany, 1st estimate GDP numbers for the 3rd quarter out of France, Spain and the Eurozone, together with October unemployment numbers out of Germany and September consumer spending figures out of France.Outside of the numbers, geo-politics will continue to be an influence, stability within the Eurozone coming under a greater threat following Merkel’s decision to step down as CDU leader, with the question now being whether the Grand Coalition can survive with a new leader of the CDU. For the Pound, there are no material stats scheduled for release, leaving the Pound in the hands of Brexit chatter and continued market reaction to the autumn budget announced on Monday, with spending plans providing some much needed support for the Pound.Yesterday’s Focus
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