What you need to know on Friday, November 5:
On Thursday, the American dollar is the overall winner, resuming its advance and reaching fresh weekly highs against high-yielding rivals. On the other hand, safe-haven assets edged higher against the greenback, although without breaking any critical level.
The Bank of England had a monetary policy meeting and decided to leave the benchmark interest rate unchanged at 0.1%, disappointing markets that were anticipating a rate hike and further boosting the dollar’s demand. The GBP/USD pair plummeted to 1.3470, to end the day around the 1.3500 figure.
The EUR/USD pair met sellers around 1.1615 for a third consecutive day, with bulls giving up, resulting in a test of 1.1527. AUD/USD briefly pierced the 0.7400 figure, settling around the level, while USD/CAD jumped to 1.2460, despite plummeting crude oil prices. WTI currently trades around $79.10 a barrel after the OPEC+ decided to maintain its current output steady at 400K barrels per day.
Gold returned to its comfort zone just below the 1,8000 mark, currently trading at around $1,793.00 a troy ounce.
Central bankers are putting a lot of effort into down-talking inflation concerns. BOE’s Governor Andrew Bailey noted that “the warning signs are there, the bells are ringing, as it were, so we have to watch this carefully, and that’s what we’re doing,” but he added that they yet see medium-term inflation “de-anchored.” On Wednesday, US Federal Reserve Chief Jerome Powell delivered a similar message, repeating that inflation is high but still expecting it to normalize without the central bank’s intervention.
European equities benefited from a dovish BOE, ending the day in the green. Wall Street was unable to follow the lead and finished the day mixed.
US Treasury yields retreated, with that on the 10-year note hitting an intraday high of 1.60% to settle near a daily low of 1.509%.
The week will end on a high note, as the US will publish the Nonfarm Payrolls report.
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