EUR/USD, USD/JPY, GBP/USD flows - better UK labour mkt data; euro crosses still weighed
GBP supported by better labour mkt data
AUD, NZD both very short start the week off on the best footing
EUR/USD quiet, euro tending to underperform on the crosses
The relatively tight start to the week continues, USD/JPY holding pretty close to 158 and EUR/USD propped in the 1.220-30s.
Reuters sources suggest the BoJ may slightly revise up its core CPI forecasts for FY27 this month, which could leave scope for another hike as soon as Dec.
France seeks to settle things with some curfews in places for now. Spreads remain towards the range highs though and the dual impact (the cost of living/education/pension concerns making fiscal consolidation explosive, and the impact in terms of boosting Le Pen) will tend to keep the wides pressured.
Antipodeans continue to see the best of the short-covering support early week (IMM data showed extreme $ longs on those counters last week), aided by the tech bounce and maybe some euro diversification - NZD/USD extending the bounce to 0.5685~ with around 0.5725 being 38% back on the end-Aug to mid Oct drop. EUR/NZD has been a rolling 2.03~ - 1.96/4 range all year and is currently on a downswing back towards the range downside.
UK labour market data the main early calendar interest and generally shows some improvement, coming in on the firmer side of expectations with earnings ex-bonus up to 3.7% (mkt 3.6%) and HMRC payrolls up 13k in Sep, with Aug notably revised also to +1k from the prelim -26k. Aug ILO unemployment also down to 4.7% from 4.9%, with the Sep claimant count (+30k) the only exception to the better prints. Data goes with the grain of Nov hike expectations and also with the grain of the cable lift from its recent oversold selloff, with GBP also showing extreme short positioning. Break above 1.3370 bounce high still needed to extend the rally however. 0.84~ is the early week EUR/GBP support ahead of extension.