• US debt ceiling talks productive but still no deal
• US dollar supported by rising yields
• PMI numbers in focus
Debt ceiling talks were deemed productive and positive yesterday, with President Joe Biden reiterating once again that default is off the table, although an agreement has still yet to be reached.
USD erased losses from earlier in the day following calls from Fed speakers that more rate hikes may be needed to quell price pressures. Yields on US treasuries climbed as a result. GBPUSD and EURUSD stayed close to Friday’s lows as the rate expectations between respective central banks continued to narrow.
All eyes on PMI numbers to give markets a gauge of how the UK, EU, and US performed in May. There is an expectation for slightly lower numbers to come in across the board when compared to April, and as ever we will be looking for divergence from what’s expected. UK service numbers will be the focus with regards to BoE rate expectations this year. Ahead of UK inflation numbers on Wednesday, GDP numbers from Germany and the US on Thursday, and core PCE numbers on Friday, markets seem likely to continue to be dictated by Fed speak as well as debt ceiling talks. For the time being the easing of Fed rate cuts this year and rising treasury yields is keeping USD in demand.
Equals Market Analysis– 23rd May 2023
Today’s Market Rates
Today’s Interbank Rates at 09:36 am against GBP movement.
GBP>EUR – 1.1475
GBP>USD – 1.2397
EUR>USD – 1.0805
GBP>CAD – 1.6766
GBP>AUD – 1.8694
GBP>SEK – 13.116
GBP>AED – 4.5531
GBP>HKD – 9.7120
GBP>ZAR – 23.891
GBP>CHF – 1.1150
• EUR – ECB Guindos, Muller, Villeroy, and Nagel
• GBP – BoE Bailey and Haskel
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