Forex news from the European trading session - 22 October 2021



  • AUD leads, GBP lags on the day
  • European equities higher; S&P 500 futures up 0.1%
  • US 10-year yields up 0.5 bps to 1.68%
  • Gold up 0.6% to $1,792.40
  • WTI up 0.7% to $83.07
  • Bitcoin up 1.2% to $63,431

There wasn't a whole lot going on in European trading today but there are a couple of decent moves all things considered, even with the lack of key headlines.

Euro area PMI data reaffirmed a slowdown in the recovery going into Q4 amid supply bottlenecks and rising inflation pressures, with a similar sentiment seen in the UK too.

Evergrande reportedly making a bond repayment a couple of days before its 23 October due date helped to lift the risk mood early on in Asia trading and while the optimism faded a little going into Europe, we're seeing equities push higher again now.

European indices are holding modest gains around 0.5% to 1.0% while S&P 500 futures are now up 0.1% from being down around 0.3% earlier on.

Tech is still the laggard though as Snap shares prove to be a drag on sentiment after a disappointing earnings outlook after the close overnight.

The dollar is a touch softer with EUR/USD moving up from 1.1625 to 1.1640 while USD/JPY eased from 114.00 to 113.80 even as Treasury yields stay elevated. That said, 10-year yields are down from the highs of 1.70% yesterday to 1.68% currently.

Commodity currencies are among the notable gainers with USD/CAD easing from 1.2350 to 1.2325 as oil prices also pull higher on the day. The aussie is the lead gainer with AUD/USD testing waters above 0.7500, looking to erase the drop yesterday.

The inflation focus continues to be a key theme in the market, with Eurozone inflation expectations exceeding 2% for the first time since 2014. That will certainly keep things interesting ahead of the ECB (BOJ and BOC too) meetings next week.