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

Daily FX Report

Read disclaimer



Euro-zone industrial confidence index strengthened marginally to 14.2 for October from 14.1 previously while there was a stronger gain in the services sector to 18.2 from 15.2 previously with a net increase in business and consumer confidence. German unemployment declined 39,000 for October compared with an expected decline of 20,000. The German CPI inflation rate increased to 4.5% for October from 4.1% previously and slightly above consensus forecasts of 4.4%.

The ECB held interest rates at 0.0% and there were no significant statement changes. Bank President Lagarde stated that momentum in the Euro-zone has moderated, but the euro-zone is continuing to recover strongly with a balanced risk outlook. She expects that inflation will rise further in the short term before declining in 2022.

Lagarde also noted that the analysis does not support market-based lift-off expectations, although she expects that the PEPP bond-buying scheme will be completed in March. She added that the central bank had tested their analysis deeply and is confident that their analysis is correct.

The Euro strengthened sharply after the press conference with Lagarde’s pushback seen as relatively mild with a less aggressive than expected effort to reverse the increase in money-market rates. There was also evidence that there had been a compromise to accommodative hawkish voices on the council. The dollar was unable to generate any traction and the Euro strengthened to highs around 1.1690 with the largest one-day advance since May as the gains triggered a round of short-covering.

The Euro was slightly lower on Friday as it traded around 1.1670 against the dollar with the US currency overall just above 1-month lows.




Bank of Japan Governor Kuroda stated that the central bank will ease monetary policy further without hesitation if needed. He added that the recent yen weakness isn’t a bad thing and this was an unusual move from the bank to comment on exchange rates.

US 2-year yields continued to move higher ahead of the New York open as the yield curve continued to flatten. US GDP increased at an annualized rate of 2.0% for the third quarter of 2021 from 6.7% previously and below market expectations of 2.7%. There was a sharp slowdown in consumer spending growth with a slide in spending on goods.  There was strength in investment spending while net exports made a significant negative contribution. The GDP data was significant in curbing dollar support.

Initial jobless claims declined to 281,000 in the latest week from a revised 291,000 previously and below consensus forecasts of 290,000. Continuing claims also declined to 2.24mn from 2.48mn previously. Overall, the dollar dipped to lows around 113.25 before a limited recovery to 113.45 as longer-term US yields edged higher.

Japanese industrial production declined 5.4% for September, the sharpest decline since May. Japan will hold a general election over the weekend with the LDP-led coalition expected to remain in power. The latest Chinese PMI business confidence data will also be monitored closely over the weekend.

Asian equity markets were mixed and the dollar secured a limited recovery to 113.60 against the yen with the Euro around 132.60 from highs near 133.0




Sterling was hampered to some extent by Brexit concerns on Thursday as the fishing dispute between the UK and Franc intensified, although the domestic and global moves in yields were more important in driving international exchange rates as overall volatility started to increase.

Higher UK inflation forecasts maintained expectations that the Bank of England would increase interest rates with the key policy meeting next week, but there were concerns that any rate hike would damage the UK economy and undermine international confidence.

There were also expectations that global central banks would adopt a more hawkish policy stance which in relative terms would lessen the potential for UK currency support. Sterling was unable to hold above the 1.3800 level against the dollar while the Euro strengthened to 2-week highs around 0.8475.

Position adjustment could have a significant impact on Friday with the UK currency holding just below 1.3800 on Friday with the Euro at 0.8460.




The Swiss franc edged lower on Thursday, although the currency was broadly resilient during the day as global yield curves flattened. The Euro edged higher to the 1.0670 area but was held near 15-month lows and the dollar retreated sharply to 0.9115. There was no significant franc selling despite expectations that global central banks would move towards tighter monetary policies. Markets will monitor National Bank actions closely, but with doubts, whether there will be aggressive intervention to weaken the currency. The Euro was unable to make headway on Friday with the fragile dollar held around 0.9120.

Technical Levels

Today's Calendar



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

Daily market commentary on LME aluminium, copper, lead, nickel, tin and zinc.

Weekly Report FX Options

Commentary and analysis covering OTC currency option pricing, volatility and positioning.

Daily Report Softs Technical Charts

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

FX Monthly Report December 2021

Monthly commentary covering the FX markets, providing insights on recent developments on select currency pairs. This month we focus on China, highlighting the fundamentals for the macroeconomy, as well as any changes to the PBOC in the coming months. The recent cut in the risk reserve requirement suggests monetary loosening. We also outline the movement between the onshore and offshore currency for those looking to arbitrage or hedge their exposure. This analysis gives an indication of the average width of the spread what key levels to look out for.

Quarterly Metals Report – Q4 2021

The global macro picture is starting to present some downside risks in the near term as China's economy is set to slow further and supply-chain bottlenecks continue to cap growth. New orders and new export orders in China are contractionary, and we expect demand in Q4. Order backlogs and lead times for products will continue in Q4, limiting growth, and real consumption is weaker than it looks. Higher costs from shipping, raw materials and energy will take their toll on the consumer, and we expect end-user demand to suffer. The final piece of the jigsaw is the reduction in stimulus from central banks and how that will impact financial markets, bond yields, and the dollar has rallied while stocks corrected, but what will this trend continue?