FX markets diverge in October 19–23 as French risks and AI stock volatility drive defensive flows
🇪🇺 EUR/USD fell around 0.4% over the week to roughly 1.119. France’s fiscal and political uncertainty pushed its bond yield spread over Germany to the widest since 2011. Slower eurozone business activity also limited the euro’s recovery.
💵 The dollar’s performance varied across currency pairs, while DXY was broadly unchanged for the week. Concerns over AI investment costs weighed on technology stocks and encouraged demand for US government bonds. The 10-year Treasury yield fell sharply on October 22, ending the week near 4.99%.
🇯🇵 The yen gained around 0.7% against the dollar, taking USD/JPY to roughly 156.9. Alongside safe-haven demand, Japanese core inflation above the 2% target reinforced expectations of a December BoJ rate hike. Markets still await guidance from the upcoming meeting.
🇨🇦 The Canadian dollar rose around 1% over the week, supported by oil prices and expectations of a BoC rate hike. Brent settled at $116.72 a barrel, up 6% for the week. Higher energy costs also increased inflation pressure on energy-importing economies.
🇬🇧 Sterling received support from UK inflation rising to 3.5%, although weak retail sales kept the outlook mixed. Differences in inflation, growth and interest-rate expectations continued to drive currency divergence.
🗓️ During October 26–30, attention shifts to central bank meetings and US GDP/PCE data. In WIB, the Fed announces its decision early on October 29, followed by the ECB later that day and the BoJ on October 30. Their policy guidance will test the durability of this week’s moves.
#Forex $ETH
🇪🇺 EUR/USD fell around 0.4% over the week to roughly 1.119. France’s fiscal and political uncertainty pushed its bond yield spread over Germany to the widest since 2011. Slower eurozone business activity also limited the euro’s recovery.
💵 The dollar’s performance varied across currency pairs, while DXY was broadly unchanged for the week. Concerns over AI investment costs weighed on technology stocks and encouraged demand for US government bonds. The 10-year Treasury yield fell sharply on October 22, ending the week near 4.99%.
🇯🇵 The yen gained around 0.7% against the dollar, taking USD/JPY to roughly 156.9. Alongside safe-haven demand, Japanese core inflation above the 2% target reinforced expectations of a December BoJ rate hike. Markets still await guidance from the upcoming meeting.
🇨🇦 The Canadian dollar rose around 1% over the week, supported by oil prices and expectations of a BoC rate hike. Brent settled at $116.72 a barrel, up 6% for the week. Higher energy costs also increased inflation pressure on energy-importing economies.
🇬🇧 Sterling received support from UK inflation rising to 3.5%, although weak retail sales kept the outlook mixed. Differences in inflation, growth and interest-rate expectations continued to drive currency divergence.
🗓️ During October 26–30, attention shifts to central bank meetings and US GDP/PCE data. In WIB, the Fed announces its decision early on October 29, followed by the ECB later that day and the BoJ on October 30. Their policy guidance will test the durability of this week’s moves.
#Forex $ETH
