EUR/USD Firms Ahead of Eurozone GDP Figures

The EUR/USD pair extends its recovery ahead of key macroeconomic data from the Eurozone and the United States (US). Today’s preliminary Harmonised Index of Consumer Prices (HICP) data from Germany and six of its states, along with Spanish Flash CPI, will provide fresh insights into whether inflationary pressures remain within the European Central Bank’s (ECB) 2% target. Additionally, recent remarks by ECB policymakers have hinted at concerns about inflation staying persistently lower due to weakening economic growth. On the dollar front, uncertainty ahead of the US presidential election continues to impact USD prices. Tuesday’s Job Openings data displayed new vacancies at 7.443 million, lower than estimates of 7.99 million and the prior release of 7.861 million. Besides the UK economic docket, today’s US Q3 Gross Domestic Product (GDP) figures and October's ADP Employment Change will also influence the EUR/USD pair in upcoming trading sessions.

GBP/USD Weakens Ahead of UK Autumn Budget

The GBP/USD is losing momentum around 1.3005 as the UK government prepares to deliver Labour’s first budget in almost 15 years on Wednesday. Markets also foresee tax hikes—including increased employers’ national insurance, capital gains, and inheritance tax—to fund struggling public services, making traders cautious. Additionally, the possibility of further rate cuts by the Bank of England (BoE) in November and December due to contained inflation is impacting the pound. On the other hand, Tuesday’s weaker-than-expected Job Openings and Labour Turnover Survey (JOLTS) figures have bolstered market expectations surrounding the Fed’s upcoming interest rate decision. Today’s release of the UK’s Autumn Budget, the US October ADP Employment Change, and advanced US Q3 Gross Domestic Product (GDP) will be key drivers for the GBP/USD trajectory.

EUR/GBP Buoyed Ahead of UK Autumn Forecast Statement

The EUR/GBP appreciated to 0.8350 due to a weaker Pound Sterling (GBP) ahead of the UK’s Autumn Forecast Statement. Additionally, UK Chancellor of the Exchequer Rachel Reeves is set to implement approximately ￡40 billion ($52 billion) in fiscal measures, focusing primarily on tax increases, to uphold her commitment to funding the government’s daily operating expenses, which pressures the Pound. In the Eurozone, market speculations of another rate cut by the European Central Bank (ECB) are undermining the Euro. Recent comments from Pierre Wunsch, Governor of the National Bank of Belgium, suggest there is no urgency to accelerate rate cuts. Preliminary Gross Domestic Product (GDP) data from Germany and the Eurozone, Germany’s preliminary Harmonised Index of Consumer Prices (HICP) figures, and the UK’s upcoming Autumn Forecast Statement will shape the market sentiment around the EUR/GBP exchange rate.

AUD/USD Steady Ahead of US Data

The AUD/USD pair remains steady at around 0.6535 despite a weaker USD ahead of key economic data. Additionally, expectations of a nominal interest rate cut from the Federal Reserve and the decline in US Treasury bond yields continue to weigh on the US Dollar (USD). On the Aussie’s front, lower-than-expected consumer inflation figures have dampened hopes for an interest rate cut by the Reserve Bank of Australia (RBA) in the last quarter of 2024, underpinning the Australian Dollar (AUD). The Consumer Price Index (CPI) grew just 0.2% quarter-over-quarter in the third quarter, down from 1.0% in the previous quarter and slightly below the anticipated 0.3%. The upcoming US economic data docket—including advanced GDP for Q3, ISM Manufacturing PMI, inflation, and employment data—along with market sentiment around the US presidential election, will shape market sentiment for the AUD/USD pair.

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