Today there is a mixture of economic data releases that will impact the markets. Eurozone Gross Domestic Product (GDP) is set to show a 0.9% year-on-year expansion. This growth is underpinned by rising consumer spending as interest rates decline, which has improved the EU economy.
This afternoon, US unemployment claims are set to marginally rise to 223K. Additionally, Producer Price Index which represents the change in the price of goods and services sold by producers in the US is expected to show an uptick across the board.
The US dollar has continued to rise this week, supported by a number of key economic factors, most notably the US CPI reading yesterday, which released high at 2.6 percent.
GBPUSD is now trading at a 4-month low as a result of Trump’s re-election and above-consensus US CPI inflation readings. Although US inflation remains above the Federal Reserve’s target of 2 percent, economists anticipate the Fed to cut interest rates by 25 basis points in December.
GBPEUR has been supported following fears that the US may impose trade tariffs, which would negatively affect Eurozone importers. As the US remains Europe’s largest trading partner, this news has triggered a selloff in the euro.
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