UK's Jeremy Hunt to unveil £54bn of tax rises and spending cuts. The chancellor will insist to MPs that his autumn statement puts the UK on a "balanced path to stability" >>>> The OBR statement is at 2:30 GMT is very important for Gilts and GBP.. (either way)
After two years of Democratic control of both the House and the Senate, the power dynamic in Washington will now shift
Federal Reserve Governor Christopher Waller said Wednesday he’s open to reducing the level of interest rate increases to half a percentage point in December >>> 50bps in Dec is no surprise to anyone, priced in by markets. The likes of JPM look for 50bps in Dec, followed by a couple of 25bps in Q1 2023, with falling inflation and rising unemployment, so they expect Fed to ease policy from early 2024 >>> pretty extreme inversion! essentially, they are agreeing to what the curve saying in markets, 150 over 2 years …with 110 or so hikes priced . Quite funky
Goldman Sachs just increased its forecast for the FED's terminal rate to 5-5.25% from 4.75-5.0%
Once valued at US$10 billion, crypto empire behind Genesis caught up in FTX turmoil
U:S Strategic Petroleum Reserve drained to March 1984 levels
U.S. retail sales rise solidly; fourth-quarter GDP estimates raised
Markets :
MOVE Index - vol decline key for markets, vol decline has been huge since mid-October, helping overall market volatily lower, geo-politics (hopefully) easing still, although rocked in Poland this week, although note the index has moved back up a little last week or so
Equity markets stopped in their track with the Poland news, but not much lower it's fair to say, SPX500 4'050 and 4'150 huge area/resistance medium-term still, acting as potential target for markets, support 3'925 area (bombed out markets, ARKK, non-profitable index etc recovered sharply from the mid-October lows (top in bond vols, peak inflation, peak USD..)
USDollar remains on backfoot, GBP looking a little perky still going into UK Budget today, CABLE actually hit a 1.2020+ this week already, we've come a long way since we called for a low in GBP (after Kamikaze budget-overshoot etc), but perhaps 1.25-1.30 CABLE is not out of question if the USDollar remain soft into year-end
Markets prone to wild short-term moves though still, markets remain pretty 'illiquid^' underneath going into Thanksgiving, World Cup, CB Dec meetings including SNB and year-end stuff - It WILL remain funky, though bond market vol lower helping, in many ways the bigger potentials move should come from China re-opening /how fast, going into 2023
Goldman says it sees a slightly longer string of 25 bps increases in '23 that will take the funds rate above 5% in May >>>>> Reasons: 1) Fiscal tightening has run its course 2) Inflation could remain "uncomfortably high" 3) Market overreactions prematurely ease financial conditions
AUDUSD key Fibo level as well around 0.6770
