Hubpay FX Weekly Report Summary

Date: 21st October 2024

Key Highlights:

US Dollar Strength Continues: The US Dollar Index climbed 0.55% this week, marking its third consecutive weekly gain. Strong retail sales data and positive economic indicators suggest the US economy is on a stable path, diminishing fears of an impending recession. Traders are now adjusting expectations for rate cuts, anticipating only 42 basis points for November and December.

Euro Weakens Amid ECB Rate Cuts: The Euro has dropped significantly, reaching levels not seen since early August. The European Central Bank's recent decision to lower interest rates, coupled with a gloomy economic outlook, has led to increased market expectations for further rate cuts.

Asia-Pacific Market Challenges:

• Renminbi: Fell 0.5% as China reported disappointing trade figures and weaker consumer inflation.
• Japanese Yen: Weakening continues, trading at 149.4 against the dollar, influenced by a slowdown in inflation rates.
• Australian Dollar: Also down 0.5% as negative sentiment from the region weighs heavily.

South Asian Stability: The Indian Rupee held steady at 84.05 against the USD, with unexpected inflation figures prompting a reassessment of rate cut expectations. The Pakistani Rupee traded slightly stronger at 277.5.

Middle East and Africa Developments:

• Nigerian Naira: Weakened by 1.6% due to rising inflation pressures.
• South African Rand: Closed 1% weaker as mixed economic signals emerge, despite an uptick in retail sales.

Europe's Mixed Signals: The British Pound remained stable, buoyed by better-than-expected retail sales data, while the Euro faces ongoing challenges from the ECB’s dovish stance.US

Election Landscape Shifts: Recent polling models show Donald Trump with a 53-61% chance of winning the upcoming presidential election, altering market sentiment as the election date approaches.

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