S&P 500 — US Large Cap Index
FTSE 100 — UK Blue Chips
Euro Stoxx 50 — Eurozone Leaders
DAX 40 — German Equities
CAC 40 — French Market Index
Nikkei 225 — Japan Benchmark
Hang Seng — Hong Kong Index
Shanghai Composite — China Mainland
ASX 200 — Australian Market
TSX Composite — Canada Index
Nifty 50 — India Large Cap
STI Index — Singapore Market
KOSPI — South Korea Index
Bovespa — Brazil Equities
JSE Top 40 — South Africa Index
IPC Index — Mexico Market- GBP/USD rises as the US Dollar struggles due to rising expectations of a Federal Reserve rate cut
- CME FedWatch Tool indicates pricing in a more than 84% chance of the 25-basis-point Fed rate cut in December.
- The Pound Sterling finds support after the UK Autumn Budget announced £26 billion in tax increases.
GBP/USD continues its winning streak for the sixth successive session, trading around 1.3260 during the Asian hours on Thursday. The pair appreciates as the US Dollar (USD) struggles amid rising odds of Federal Reserve (Fed) rate cut bets in December.
US data showed unexpectedly low Initial Jobless Claims and stronger-than-expected Durable Goods Orders, yet rate-cut expectations remained intact. The CME FedWatch Tool suggests that markets are now pricing in a more than 84% chance that the Fed will cut its benchmark overnight borrowing rate by 25 basis points (bps) at its December meeting, up from the 30% probability that markets priced a week ago.
The US Department of Labor (DOL) reported Wednesday that Initial Jobless Claims dropped to 216,000 for the week ending November 22, a decline of 6,000 from the prior week’s revised level and below the market forecast of 225,000. Meanwhile, the 4-week moving average slipped by 1,000 to 223,750.
Fed rate expectations increased by reports that the White House has narrowed its search for the next Fed chair to National Economic Council Director Kevin Hassett. Investors see Hassett as supportive of US President Donald Trump’s preference for lower interest rates.
Additionally, the GBP/USD pair gains ground as the Pound Sterling (GBP) receives support after the latest United Kingdom (UK) budget revealed by Chancellor of the Exchequer, Rachel Reeves, raising taxes by £26 billion, following last year’s budget raised taxes by £40 billion.
UK Finance Minister Rachel Reeves said the government has £22 billion in fiscal headroom to absorb unexpected shocks. However, the Office for Budget Responsibility (OBR) noted that this room remains “limited” relative to its projections.
