Collinson Forex Daily Market Commentary

Daily Market Commentary

US equity markets stabilised, after suffering heavy losses the previous session, following the hotter than expected inflation number in the US. The UK CPI number was cooler than expected, as markets had expected the inflation rate to rise to 4.2%, considering inflationary pressures and supply chain issues, arising from the Middle East conflict. The CPI number was steady on 4%, which may encourage the Bank of England to consider rate cuts, but inflation remains a challenge. Bond Yields settled in both the US and Europe, while UK Gilts drifted lower on the inflation news. The EUR crept back to 1.0730, while the GBP fell back to 1.2550, following the dovish inflation news.

Commodity currencies stabilised following yesterday's rout, with the AUD looking to regain 0.6500, while the NZD bounced off 0.6050. GDP growth in European nations remains in recessionary territory, begging for rates from the ECB, but the RBA will be watching the latest Australian Employment statistics, to consider inflationary pressures from the labour market. Keep a close eye on the UK GDP number set to be released tonight.

PLEASE NOTE THE VIEWS EXPRESSED IN THIS COMMENTARY ARE THOSE OF THE AUTHOR AND NOT COLLINSON & CO

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