1. Reports
  2. Daily FX Report
Non-independent Research

Daily FX Report

Read disclaimer


The Euro-zone October unemployment rate declined to 8.4% from 8.5% previously and in line with consensus expectations. There was no significant impact from the data releases with the Euro maintaining a strong underlying tone. After a correction to just below 1.2050 against the dollar, the single currency found fresh buying interest as the US currency lost ground once again amid expectations of long-term US currency depreciation amid a flow of funds into alternative assets.
US ADP data recorded an increase in private-sector payrolls of 307,000 for November following a revised 404,000 increase the previous month and the weakest growth for six months. There were net increases across all sectors, although there was further overall evidence that the labour market was slowing.
The November New York business conditions index also declined to 44.2 from 65.1 previously with unease over near-term trends.
Philadelphia Fed President Harker stated that the economy appeared to be plateauing with moderate growth expected for 2021. Fed Chair Powell stated that there may be light at the end of the tunnel by the middle of next year. The dollar overall remained on the defensive and the Euro challenged 1.2100 at the European close.
The Fed’s Beige Book stated that most districts reported little or no growth with fears that employment levels would decline over the winter before recovering further. There was also evidence of deterioration in loan portfolios. The report indicated the potential for further Fed action to support the economy and the dollar lost further ground. There was no change in mood on Thursday with the dollar sliding to fresh 31-month lows and the Euro above 1.2100 for the first time since the end of April 2018. Markets will be on alert for any commentary from the ECB, although the bank may decide again engaging with the market ahead of next week’s policy meeting.


US bond yields continued to move higher on Wednesday with the 10-year yield approaching the 1.00% level. Higher yields should trigger increased capital flows from Japan, but there were expectations that the flows would be hedged which would prevent any benefit to the US currency. The dollar strengthened to highs around 104.75 against the yen before a retreat to 104.50 amid wider US currency losses.
Senate majority leader McConnell stated that the Democrats were negotiating in good faith which maintained optimism that there would be agreement on a fiscal stimulus with the dollar settling around 104.50. The US House of Representatives passed the Bill which could delist Chinese companies from Wall Street. US data recorded the highest daily death toll since the pandemic started while Los Angeles introduced tight restrictions to combat an increase in cases.
China’s Caixin PMI services-sector index strengthened to 57.8 from 56.8 previously and the composite index recorded the sharpest increase since March 2010. Overall risk appetite held firm with the dollar holding just below the 104.50 level while the Euro strengthened to near 126.50.


Sterling dipped sharply in early Europe following EU Barnier’s briefing of the 27 EU Ambassadors. According to Barnier some slow progress had been made, but there were still important differences and he could not say whether there would be a deal. There was generally negative rhetoric ahead of the New York open with France, for example, reported to be pushing for a no-deal outcome unless there were British concessions and also warned over a veto threat if EU conceded too much ground. EU Ambassadors also pushed for a firm stance while Barnier indicating that he had very little scope for manoeuvre under his mandate and Sterling moved sharply lower.
Tensions continued to increase given the risk of political mis-steps during the crucial end game period. Confidence in the UK outlook remained very fragile despite positive news on the Pfizer vaccine deployment. Sterling continued to lose ground with lows below 1.3300 against the dollar while the Euro strengthened to 5-week highs around 0.9085. Sentiment stabilised later in the session given the possibility that a deal could still be secured at the end of this week. Optimism over a global recovery also provided an element of protection with Sterling back close to 1.3400 against the weak dollar while the Euro retreated slightly to near 0.9050.


Swiss consumer prices declined 0.2% for November with the year-on-year rate at -0.7% from -0.5% and below consensus forecasts of -0.6%. The data will tend to maintain National Bank concerns over deflation risks. The Swiss franc still secured solid gains despite expectations of an extremely accommodative central bank policy.
The Euro dipped to 1.0815 before recovering while the dollar dipped to 5-year lows below 0.8950 after a decisive break below the 0.9000 level. The US currency continued to lose ground on Thursday with fresh 5-year lows around 0.8935 with further franc resilience despite optimism over the 2021 growth outlook.



This is a marketing communication. The information in this report is provided solely for informational purposes and should not be regarded as a recommendation to buy, sell or otherwise deal in any particular investment. Please be aware that, where any views have been expressed in this report, the author of this report may have had many, varied views over the past 12 months, including contrary views.

A large number of views are being generated at all times and these may change quickly. Any valuations or underlying assumptions made are solely based upon the author’s market knowledge and experience.

Please contact the author should you require a copy of any previous reports for comparative purposes. Furthermore, the information in this report has not been prepared in accordance with legal requirements designed to promote the independence of investment research. All information in this report is obtained from sources believed to be reliable and we make no representation as to its completeness or accuracy.

This report is not subject to any prohibition on dealing ahead of the dissemination of investment research. Accordingly, the information may have been acted upon by us for our own purposes and has not been procured for the exclusive benefit of customers. Sucden Financial believes that the information contained within this report is already in the public domain. Private customers should not invest in these products unless they are satisfied that the products are suitable for them and they have sought professional advice. Please read our full risk warnings and disclaimers.

Sign-up to get the latest Non-independent research

We will email you each time a new report has been published.

You might also be interested in...

Daily Report Base Metals

Our daily commentary, covering market news and closing prices of LME aluminium, copper, lead, nickel, tin, zinc, iron ore, steel, and precious metals.

Daily Report Softs Technical Charts

Technical analysis and charts for the key sugar, cocoa and coffee contracts.

Weekly Report FX Options

Our FX Options Report contains commentary and analysis covering OTC currency option pricing, volatility and positioning. 

Quarterly Metals Report – Q3 2022

Our analysts provide an in-depth analysis of the metals market and current macroeconomic conditions. The environment has weakened significantly as growth fears rise amid persistent high inflation. Central banks are data-dependent, which could mean they slow rate hikes as growth starts to slow. This has meant a downside to the US 10yr yield, but also we see a downside to rate hikes in Q4. Europe will likely enter a recession before the US and take longer to recover, but material availability is significantly lower, shown by low inventories.

FX Monthly Report June 2022

Monthly commentary covering the FX markets, providing insights on recent developments on select currency pairs. This month we look into the JPY and the pressure the BOJ is under to change their monetary policy as JPY continues to weaken against major currencies. Economic data is weakening and inflation is less of a problem in Japan, but yields continue to test the cap.