United States of America

USD is weakening against its main competitors – EUR, JPE, and GBP.

Investors are focused on the meeting of the US Federal Reserve, at which the key rate may be reduced by another 25 basis points, from 5.00% to 4.75%, but the greatest interest among market participants is caused by possible hints about further actions of officials. The American economy may soon find itself in a state of uncertainty due to the policies of the new White House administration: experts believe that the proposals of the representative of the Republican Party Donald Trump, including increasing import tariffs, reducing taxes, and restricting migration, are capable of significantly changing the regulator's previously made forecasts for economic growth and inflation, as well as adjusting the course of monetary policy. Recall that before the presidential elections, most traders and analysts expected that officials would adjust interest rates twice by the end of the year, in November and December, but now the December reduction in the cost of borrowing is in question. Experts have also revised their forecasts for the final level of the key rate: it was previously assumed that the US Federal Reserve would reduce it to 3.0%, but now it is expected that the value will not fall below 4.00–3.75%.

Eurozone

EUR is strengthening against USD but has ambiguous dynamics in pairs with JPY and GBP.

Today, September data on Germany's foreign trade was published, which turned out to be negative: the volume of exports fell by 1.7%, exceeding the forecast of decline by 1.6%, and the volume of imports increased by 2.1% against preliminary estimates of 0.5%. Thus, the trade surplus decreased from 21.4 billion euros to 17.0 billion euros instead of 20.8 billion euros. In addition, September statistics on industrial production in Germany were published today: the figure fell by 2.5% after growing by 2.6% a month earlier. Experts note that the crisis in German industry continues and may worsen if US President-elect Donald Trump fulfills his promise to introduce an additional 10.0% duty on European goods imported into the country. In this regard, it is worth noting the comments of leading officials of the European Central Bank (ECB): the Governor of the Bank of France, François Villeroy de Galhau, noted that the election of Donald Trump increases the risks of a deterioration in the situation in the global economy, and the ECB Vice President Luis de Guindos added that the growth of the Eurozone economy may be weaker than previously expected due to the possibility of new “trade wars”.

United Kingdom

GBP is strengthening against USD and JPY but has ambiguous dynamics in pair with EUR.

Investors are focused on the results of today's Bank of England (BoE) meeting, where the key rate was adjusted by 25 basis points, from 5.00% to 4.75%. Officials noted that further easing of monetary policy will be gradual due to high inflation and strong economic growth, and that the budget presented last week by Chancellor of the Exchequer Rachel Reeves, which implies significant increases in taxes, spending, and borrowing, will increase the size of the UK economy next year by about 0.75%. At the same time, inflation by the end of this year will be 2.5%, and by the end of next year – 2.7%, before starting to decline. Previously, it was expected that the dynamics of consumer price growth will reach the target of 2.0% as early as 2025. Thus, the regulator will likely reduce borrowing costs more cautiously in the future, which will provide additional support to the national currency exchange rate.

Japan

JPY is weakening against GBP, strengthening against USD, and has ambiguous dynamics in pair with EUR.

Today, Japan's top currency diplomat Atsushi Mimura said that recent changes in the national currency rate were too “sharp and one-sided”, and also noted that the authorities are closely monitoring market events, including the actions of speculators, and are ready to take measures to slow the fall of the yen. Experts interpreted these statements as another hint at the possibility of currency interventions, but the effect of them seems insignificant and short-term to specialists.

Australia

AUD is strengthening against its main competitors – EUR, JPY, GBP, and USD.

September trade data released today turned out to be weak: exports fell by 4.3% after a 0.6% decline in August, while imports fell by 3.1% after a 0.2% correction. Thus, the trade surplus decreased from 5.284 billion Australian dollars to 4.608 billion Australian dollars. Also worth noting are the latest comments from Reserve Bank of Australia (RBA) Governor Michele Bullock, who said today that it is difficult to assess the inflationary impact of the US election for the country at this time, but officials will monitor the situation closely and respond as necessary.

Oil

Oil prices are correcting downwards today amid investors' reaction to the election of Donald Trump as US President, as well as data from the Energy Information Administration (EIA) report on petroleum product inventories.

Experts fear that the new White House administration will put significant pressure on the Chinese economy, which will result in a significant decrease in demand for oil from the world's leading importer. The EIA weekly report published yesterday recorded an increase in oil reserves by 2.149 million barrels against preliminary estimates of 0.300 million barrels, while gasoline reserves grew by 0.412 million barrels, and distillates by 2.947 million barrels. The drop in quotes could have been more significant, but the new hurricane Rafael has already led to the shutdown of 17.0% of oil production capacity and 7.0% of gas production capacity in the Gulf of Mexico.