Euro softer at the open this morning

The euro jumped to almost $1.19 against the dollar on Friday after softer than expected inflation data in the US. It has since come back by almost a cent to trade below $1.18, with the strong showing of the far-right in the Austrian election over the weekend perhaps weighing on the currency

Sterling held up well last week even as the EU’s Barnier said the Brexit talks are deadlocked on the question of the UK’s financial settlement. The UK currency is trading at just over 88.5p this morning, having briefly hit around 90p at one stage last week

The annual rate of headline CPI inflation in the US rose to 2.2% in September (slightly shy of the consensus forecast of 2.3%), while the core rate was unchanged at 1.7% for a fifth consecutive month

Fed chair Janet Yellen reiterates that further gradual increases in US interest rates are likely to be warranted, while the ECB’s Constancio says  a ‘very substantial degree of monetary accommodation’ is still needed to get Euro area inflation back to target

Data due this week include CPI inflation, retail sales and labour market report in the UK, while the EU Council meets on Thursday/Friday to discuss progress (or lack of) in the Brexit talks