North American Summary and Highlights 10 October

North American session

US data showed a sharp rise in initial claims to 258k from 225k, and a slightly stronger than expected September CPI at 0.2% overall and 0.3% ex food and energy. The initial claims rise was in part attributed to Hurricane Helene, but a further boost is expected from Hurricane Milton. The CPI upside surprise looked a little broader based than a similar one in August, which was led by housing. Still, the initial claims data initially outweighed the CPI and the USD moved a little lower. Most of the day’s Fed speakers had little impact but a remark by Bostic that he was open to a rates pause in November gave the USD a boost, which while subsequently largely reversed left the USD little changed on the day.

EUR/USD was little changed near 1.0925 but USD/JPY slipped to 148.65 from near 149. CHF also was slightly stronger with EUR/CHF seeing lows below .9350 and USD/CHF falling 20 pips to 0.8570. CAD was relatively weak with USD/CAD above 1.3750 and AUD/CAD above .9250. 

European morning session

The USD was mixed in the European morning, losing some ground against the JPY but gaining slightly against the EUR. USD/JPY fell from 149.20 to 148.90, while EUR/USD slipped from 1.0940 to 1.0930. USD/CAD rose 20 pips to 1.3730, and EUR/CHF lost 10 pips to 0.9400. AUD/USD also fell back slightly but GBP/USD was little changed.

The main data during the morning was the Norwegian September CPI data, which was weaker than expected with the headline rising less than expected to 3.0% y/y and the core falling slightly to 3.1% y/y. However, there was minimal impact on the NOK, with EUR/NOK initially rising slightly but finishing the morning little changed at 11.78. Swedish August GDP rose a strong 1.1% after a 0.9% drop in July, but the volatility of these numbers limits their impact. German retail sales showed the second consecutive solid m/m gain in August, rising 1.6%, but the underlying trend remains quite flat.