IFX Market Report: Tuesday 16th November 2021

The Euro came under more pressure on Monday as European Central Bank President Christine Lagarde reiterated her view that conditions for a rate hike are “very unlikely” to be met in 2022. While this news is not new, Lagarde’s comments “for sure added pressure on the shared currency” and the Euro struggled against its peers on the day. Lagarde is due to speak again today at 16:10, but before that, Euro bulls will be hoping for positive Eurozone GDP figures at 10:00. GDP Growth Rate for Q3 is expected at 2.2% MoM, and 3.7% YoY. However, if today’s release goes against expectations the Euro could see heightened volatility.

Sterling was able to capitalize on a weaker Euro on Monday. GBPEUR opened the day at 1.1717 and closed at 1.1771.

Cable also made gains yesterday, finishing the day close to the 1.3450 mark. GBPUSD started the week at 1.3414 and closed at 1.3443.

EURUSD traded in a tight range yesterday but finished the day lower. The pair opened at 1.1448 and closed at 1.1420.

The Dollar “edged lower Monday, retreating from a 16-month high, as traders seek new clues as to the Federal Reserve’s thinking over the timing of interest rate hikes”. Today the Greenback will be focusing on October’s Retail Sales figure, hoping that a strong reading could give the currency a boost. With a previous of 0.7%, the forecast for this month is at 1.1%. Also released from the US today will be Industrial Production, Business Inventories, and NAHB Housing Market Index. Then later in the evening Fed members Raphael Bostic, Patrick T. Harker, and Mary C. Daly, will all be speaking.

At 07:00 this morning UK Employment Change and Unemployment Rate was released. Employment Change for August gave a final reading of 247K, while September’s Unemployment Rate came in at 4.3%.

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