The Dollar was broadly unchanged until Thursday but on Friday depreciated across the board to end the week down 0.3% in trade-weighted terms at its lowest level since early August. US GDP growth surprised on the upside in Q3 at 1.9% qoq annualised but this did not stop the Federal Reserve from cutting rates 25bp as expected. Chairperson Powell suggested that while rates may remain on hold for the foreseeable future a rate cut was still more likely than a rate hike, which was music to equity markets’ ears. The S&P500 closed at another record high of 3,067 on Friday.
Sterling, the Euro and Swiss Franc all ended the week up about 0.3% but they remain in narrow multi-week ranges. Sterling is currently in the middle of a narrow 3-week range, with little reaction to parliament’s vote in favour of an early general election on 12th December. Similarly, the Euro is still within a 6-week range of only 0.7% while the Swiss Franc is broadly in the middle of a 4-week range despite the release of weak Swiss retail sales and CPI-inflation data on Friday
The Australian and Kiwi Dollars made slightly more convincing gains of respectively 0.9% and 0.6%, with markets having faded the odds of the RBA and RBNZ having to cut their policy rates again before year-end.
