Forex Today: BoE policy announcements to set direction for Pound Sterling
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Here is what you need to know on Thursday, November 6:
The trading action in financial markets turns choppy early Thursday as investors gear up for the Bank of England's (BoE) monetary policy announcements. The European economic calendar will feature Eurozone Retail Sales data for September. In the second half of the day, Challenger Job Cuts data for October data from the US will be scrutinized by market participants.
The data from the US showed on Wednesday that the business activity in the service sector continued to expand at an accelerating pace in October, with the Institute for Supply Management's (ISM) Services Purchasing Managers' Index (PMI) rising to 52.4. Additionally, the Automatic Data Processing (ADP) announced that employment in the private sector rose by 42,000 in October, surpassing the market expectation for an increase of 25,000. Although the US Dollar (USD) Index climbed to its highest level since late May above 100.30 after the upbeat data, it erased its gains to end the day flat. The improving risk mood, as reflected by the modest gains in Wall Street's main indexes, made it difficult for the USD to preserve its strength. Early Friday, the USD Index stays in a consolidation phase at around 100.00, while US stock index futures trade marginally lower on the day.
US Dollar Price This week
The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the strongest against the New Zealand Dollar.
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
The BoE is widely anticipated to leave the policy rate unchanged at 4% following the November meeting. BoE Governor Andrew Bailey will explain policy decisions and respond to questions in a press conference starting at 12:30 GMT. Investors will look to see how the BoE policy will be set if the Autumn Budget includes tax hikes, as hinted by Chancellor of the Exchequer Rachel Reeves earlier in the week. Following Tuesday's sharp decline, GBP/USD managed to post small recovery gains on Wednesday. In the European morning on Thursday, the pair holds steady at around 1.3050.
The data from Australia showed early Thursday that Exports rose by 7.9% on a monthly basis in September, while Imports increased by 1.1%. AUD/USD stays relatively quiet on Thursday and trades in a narrow channel above 0.6500.
EUR/USD registered small gains and snapped a five-day losing streak. The pair stays in a consolidation phase and trades slightly above 1.1500 in the European morning on Thursday.
USD/JPY moves sideways near 154.00 after closing marginally higher on Wednesday.
Gold extends its rebound after rising more than 1% on Wednesday and tests $4,000 in the European morning on Thursday.
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* The content presented above, whether from a third party or not, is considered as general advice only. This article should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments.
