Main currencies steady

The main currency pairs are little changed this morning with the euro still trading just north of $1.16 against the dollar and a touch under 84.5p against sterling, while the pound continues to hover close to $1.38 against the US currency

In bond markets, yields have edged higher with US and German yields rising to around 1.65% and -0.11% respectively with equivalent UK yields up to around 1.15%. Meanwhile, stocks advanced yesterday with both European and US indices closing in positive territory

The annual rate of CPI inflation in the UK dipped to 3.1% in September (from 3.2% the previous month) though it is likely to resume its advance in the final quarter of this year as higher energy costs kick in

ECB Chief Economist Philip Lane says “it’s challenging to reconcile some of the market views (on interest rates) with our pretty clear rate forward guidance” – the market has started to price in an earlier start to raising interest rates in the zone (late 2022) than the ECB believes is likely to be the case

Fed’s Waller says he believes that “tapering of our asset purchases should commence following our next (monetary policy) meeting, which is in two weeks”, adding that “liftoff (for interest rates) is still some time off” however

Data due today includes CPI inflation in the Euro area