Key Points:
• Dollar has first positive week since February
• Pill calls “turning point” for inflation
• Debt ceiling talks resume tomorrow
Recap:
USD continued to gain on Friday as markets remained cautious about the US debt ceiling going into the weekend.
BoE chief economist Huw Pill gave a clear sign on Friday that the BoE may be looking to pause on future rate hikes after he stated that inflation has hit a “turning point” and is likely to slow.
Markets
The US debt ceiling remains a big factor in how USD is likely to perform this week as well as a host of Fed speakers. Fears of a US default as well as rhetoric from Fed speakers that they do not see interest rate cuts this year will likely be supportive of USD. The latest on the debt ceiling will see Joe Biden meeting with Kevin McCarthy and other congressional leaders tomorrow to avert a default.
For the UK this week, focus will fall on Tuesday’s wage and job numbers. Higher wages remain a concern for the BoE in their battle against inflation and further rises in wages will likely add to the belief that interest rates may have to rise further – which of course will likely be GBP-supportive.
From the eurozone this week, the first estimate of economic growth is due out on Tuesday followed by inflation numbers on Wednesday. Today sees the EU Commission’s economic forecasts on growth and inflation.
Equals Market Analysis– 15th May 2023
Today’s Market Rates
Today’s Interbank Rates at 08:56 am against GBP movement.
GBP>EUR – 1.1479
GBP>USD – 1.2483
EUR>USD – 1.0875
GBP>CAD – 1.6860
GBP>AUD – 1.8658
GBP>SEK – 12.981
GBP>AED – 4.5817
GBP>HKD – 9.7860
GBP>ZAR – 23.790
GBP>CHF – 1.1191
Today’s Speeches
• GBP: BoE Huw Pill
• EUR: ECB Nagel
• USD: Fed Bostic and Kashkari
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