Good morning one and all!
Well, what a move in the JPY yesterday! Is this the return of the carry trade? Certainly it is trading 101 as yields diverge on central bank anticipated action to control rising inflation.
The data docket is a bit busier today with the following main events on the menu.
0700 UK August employment data. See prior release here.
This data will be important to set expectations for the UK post the furlough scheme coming to an end. This is August data and the scheme ended in September, but it can set the mood music, so one to watch out for. Unlikely to have much impact in the GBP as rate expectaions are what's driving GBP at the moment. Also the return of Brexit shenanigans is a headline risk on the N.Ireland protocol.
1000 October German ZEW economic sentiment. Prior reading here.
The last release hinted that the anticipated Q4 slowed down was more severe. Will supply chain disruptions weigh on sentiment again? A weak print here and that could see some downside in EURUSD
1100 US September NFIB business optimism. Prior reading here
This will be watched for any signs that inflation is starting to weigh on business activity.
Central banks speakers
ECB's Phillip Lane at 1300 speaking on "Central Bank policy bridging science and practise'"
