Sterling loses some ground

The pound has lost some ground against both the euro and the dollar, as tensions run high  between the UK and the EU ahead of next week’s Council meeting on 17th-18th October, weakening to almost 89p and $1.22 respectively. The single currency is continuing to trade in a relatively narrow range against the dollar and is hovering just below $1.10 this morning

Equity markets are continuing their soft start to the final quarter of the year with both US and European stocks closing lower yesterday, bringing their cumulative decline since the start of October to around 3%.  Bond yields in the core markets are little changed as they continue to trade close to their 2019 lows set in early September

Fed Chair Powell says the central bank continues to see a sustained expansion of (US) economic activity, strong laboor market conditions, and inflation near its 2% target ‘as most likely’. However it acknowledges there are risks to this favourable outlook and so will ‘carefully monitor’ incoming information and act as appropriate to support continued economic growth (suggesting another interest rate cut is in the offing soon)

Budget 2020 presented here at home yesterday included a Brexit package of over €1.2bn, of which €200m will be available next year (‘deal’ or ‘no deal’) for staffing and infrastructure needs with the remainder used to support the sectors, regions, and citizens most affected by a ‘no deal’ Brexit

Data due today includes job openings in the US as well as the minutes of the recent Fed meeting