Daily Market Update 04/10/2021

Main Headlines:

The US is moving closer to its first-ever default, with neither political party in Washington yet signaling it’s ready to back down from a partisan showdown on the federal debt limit. Democratic Leader Chuck Schumer plans another vote as early as Monday on a measure passed by the House to suspend the federal government’s legal debt limit until December 2022. Democrats, working to unite around a far-reaching social policy and climate bill, are weighing two different approaches to reduce its overall cost: eliminating proposed programs entirely or cutting their duration.

Rishi Sunak will on Monday set aside £500m to help UK-based people find jobs, as the government grapples with a post-Brexit “period of adjustment” that has seen acute labour shortages in some sectors. Speaking at the start of a Conservative conference in Manchester overshadowed by fuel shortages and warnings of Christmas supply disruption, Sunak will insist the government has a plan to bolster the workforce. The £500m package of support — targeted at those leaving the furlough scheme and older workers — comes after prime minister Boris Johnson refused to fill labour market holes by pulling “the big lever marked uncontrolled immigration”.

Markets

GBP

Sterling is stronger versus the dollar and weaker against the euro this morning. A US private equity group, Clayton, Dubilier & Rice, has won an auction for the British supermarket Morrisons with a £7bn bid. Elsewhere, professional services firms in the UK have warned of growing “white collar” labour shortages as businesses fight it out for top talent amid economic recovery. The UK accounting regulator is under pressure to disclose the full findings of its routine inspections of large company audits to protect shareholders and other stakeholders who could lose out if financial statements are misleading.

EUR

The euro is higher against most major currencies overnight. Europe’s escalating energy price crisis will be the focus of attention today in Luxembourg when eurozone finance ministers discuss how surging electricity and gas prices could strain government coffers and scupper the EU’s nascent economic recovery. The EU’s southern and eastern countries have called on Brussels to help alleviate the pressure on their struggling households, demanding the European Commission come up new emergency funds and provide explicit support for national spending measures to protect consumers.

USD

The dollar is lower against most majors in the early morning trade. California officials were trying to limit damage from a major oil spill off the coast of Orange County on Sunday, as oil reached beaches and threatened wetlands south of Los Angeles. The spill of an estimated 126,000 gallons from an oil-processing platform about 5 miles offshore extended from Newport Beach to Huntington Beach, a distance of roughly 6 miles. A transformed Supreme Court, which is dominated by six Republican appointees, returns to the bench on Monday to start a term in which it will consider eliminating the constitutional right to abortion, vastly expanding gun rights and further chipping away at the wall separating church and state.

Ballinger & Co. Morning Report–04th October 2021

Today’s Rates

GBP>EUR – 1.1680

GBP>USD – 1.3565

EUR>USD – 1.1609

GBP>CAD – 1.7119

GBP>AUD – 1.8665

GBP>SEK – 11.849

GBP>AED – 4.9816

GBP>HKD – 10.559

GBP>ZAR – 20.259

GBP>CHF – 1.2614

Today’s Calendar           

·       CHF       Real Retail Sales (YoY)(Aug)

·       EUR      ECB’s De Guindos speech

·       USD      OPEC Meeting

·       USD      Factory Orders (MoM)(Aug)

·       NZD      NZIER Business Confidence (QoQ)(Q3)

·       AUD      AiG Performance of Construction Index(Sep)

·       AUD      Commonwealth Bank Services PMI(Sep)

Today’s Highlights

·       Forex Today: Evergrande, infrastructure and inflation worries return ahead of OPEC+

·       EUR/USD Forecast: Euro set to resume falls on inflation gap, two other issues

·       Week Ahead on Wall Street: Inflation 30 year high, this dip may not be transitory

·       US Dollar Index looks offered, drops below 94.00

 (https://frank-exchange.com/)

This document has been prepared solely for information and is not intended as an Inducement concerning the purchase or sale of any financial instrument. By its nature market analysis represents the personal view of the author and no warranty can be, or is, offered as to the accuracy of any such analysis, or that predictions provided in any such analysis will prove to be correct. Should you rely on any analysis, information or report provided as part of the Service it does so entirely at its own risk, and Frank eXchange Limited/Manor House Foreign eXchange Limited accepts no responsibility or liability for any loss or damage you may suffer as a result. Information and opinions have been obtained from sources believed to be reliable, but no representation is made as to their accuracy. No copy of this document can be taken without prior written permission.

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