The Bank of England Brewing Storm

The Bank of England Brewing Storm

The Bank of England is once again at the centre of this brewing storm.

As investors await the government’s Halloween spending review and long-awaited estimates from its watchdog at the Office for Budget Responsibility (OBR), bond investors remain unnerved about largely unfunded tax cuts and energy supports revealed last month as well as how that complicates the BoE’s inflation battle.

Renewed U.S. dollar strength also sent the risk-sensitive Australian dollar to $0.6247, the lowest since April 2020.

U.S. inflation data on Wednesday and Thursday is expected to keep the Fed on an aggressive rate hike path.

The International Monetary Fund on Tuesday cut its 2023 global growth forecast from 2.9% to 2.7%, warning that pressures from inflation, war-driven energy and food crises, and higher interest rates may tip the world into recession and financial market instability.

Stocks may decline Wednesday as investors remain focused on global slowdown worries amid rising interest rates and the Ukraine war. Asian stocks were lower; the dollar rose; Treasury yields fell; oil and gold declined.

Remember, where there is volatility, there is an opportunity to trade!

Wednesday 12th October High Impact Events

The times below are GMT+3

14.35 – UK – MPC Member Pill Speaks
Potential instruments to Trade: GBP Crosses.

15.30 – US – PPI m/m & Core PPI m/m
Potential instruments to Trade: USD Crosses.

16.30 – EUR – ECB President Lagarde Speaks
Potential instruments to Trade: EUR Crosses.

DAY 1 – G20 Meetings
Potential instruments to Trade: All Crosses.

21.00 – US – FOMC Meeting Minutes
Potential instruments to Trade: USD Crosses.

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