The market sentiment is mixed, but there are still interesting movements on the market.
Will the GBP get stronger on PMIs?
UK Services and Manufacturing PMIs are announced on Friday at 11:30 MT time.
Instruments to trade: EUR/GBP, GBP/USD, GBP/JPY, GBP/CHF
The GBP is in a hard position now – as it apparently will be during the entire 2020. On the one hand, the British authorities are coming up with strong monetary stimulus and other measures to fight off the virus fallout and jump-start the UK economy. On the other hand, Boris Johnson’s stance in Brexit negotiations is becoming more and more rigid. In the meantime, the British economy is contracting in almost all spheres at a frightening pace. Although the situation has been somewhat stabilizing since April, the latest PMI results are still below the key mark of 50.0 that would signal the industry expansion. Therefore, some good news from this front would definitely help the GBP to stay afloat.
- If the PMIs reveal better-than-thought results, the GBP will rise;
- Otherwise, it will fall.
US Core monthly retails sales will be announced on Friday at 15:30 MT time.
Stock significantly surged: S&P 500 and Nasdaq reached 6-week highs. The market sentiment may deteriorate today as Johnson & Johnson’s Covid-19 vaccine trails have been stopped because of the unexplained illness.
Canada’s retail sales will be out on October 21 at 15:30 MT time. Get ready with us for this event!
The market is resilient ahead of the speeches of Fed’s Powell and ECB President Lagarde, but there are still interesting movements.
The uncertainty over US fiscal stimulus and Brexit, and also rising new virus cases deteriorated the market mood. That’s why we can expect the further rally of the US dollar and the fall of riskier assets today.