Sterling investors largely shrugged off the weak UK public sector net borrowing data as the Pound showed little reaction against the majors this morning. Market attention has now shifted on to the minutes of the BoE’s latest policy meeting scheduled tomorrow for further direction. Traders are anticipated to scrutinise the minutes to gain an insight into the timing of an interest rate rise in the UK.Across the Atlantic, the only notable macro trigger today is the existing home sales report which is expected to show encouraging sales for September. Meanwhile, in the absence of any important economic data in Europe, the common currency is likely to remain supported against the majors following better than anticipated Chinese GDP data for the third quarter.
With a light global economic calendar today, currency markets are unlikely to witness any major volatility. The minutes of the BoE’s latest policy meeting will be keenly scrutinised later this week for more details about the central bank’s future stance, along with the preliminary third quarter GDP numbers scheduled on Friday. In the Euro zone, the soft German producer price inflation report released earlier today has confirmed that the prospect of deflation continues to cause concern.Across the Atlantic, the US Fed Chief’s comments on Friday provided no hints to the central bank’s next policy move. Going forward, market participants will remain focused on tomorrow’s GDP numbers in China to reassess their appetite for risk.
With no crucial economic releases in the UK today, investors are likely to focus on Wednesday’s publication of the minutes from the BoE’s last policy. It remains to be seen whether some of the BoE officials continued to vote in favour of an immediate rise in the nation’s interest rates.Across the Atlantic, the US Fed Chief’s speech will be closely watched in order to monitor if Janet Yellen voices support to keeping monetary policy loose over a prolonged period in the midst of dampening outlook for growth in the global economy. In the Euro zone, the preliminary PMI numbers across key European nations scheduled for release next week will help investors gauge if the macro trend in the region continues to weaken.