Hang Seng plunged on Covid concerns, UK retail sales indicate solid start to Q4, Israeli inflation prints higher than expected.
November 21, 2022
GBP/USD 1.1799 GBP/EUR 1.1528 EUR/USD 1.0236 USD/CAD 1.3439 EUR/CHF 0.9806 EUR/SEK 10.9906 EUR/NOK 10.5194 EUR/DKK 7.4382 USD/ILS 3.4670 AUD/USD 0.6610 NZD/USD 0.6107 USD/SGD 1.3816 USD/JPY 141.84 USD/CNH 7.1694 USD/INR 81.8438 EUR/ILS 3.5486 GBP/ILS 4.0907 USD/ZAR 17.4428
Hunt’s fiscal plan outlined last week could cause a headache for the BoE. Whilst the plan focuses on tax hikes and spending cuts, the fiscal policy did outline near-term fiscal boost, which could translate into stronger medium-term price pressures.
UK retail sales rebound at the start of the fourth quarter masks a bleaker outlook. We expect consumer spending to remain under pressure going forward. Retail sales rebounded by 0.6% month-on-month, indicating a solid start to Q4.EUR
This winter is again likely to be challenging for the euro-area. Growth held up surprisingly well as governments across the bloc stepped in to help consumers and lost ground finally being made up by the pandemic rebound.
The ECB current focus has been on tackling high inflation rather than supporting growth. With signs that inflation may be easing, and following two back-to-back 0.75% hikes, forecasts now see the ECB opting for a smaller increment in December.USD
The US and China resumed formal climate change talks at COP27 and will keep meeting on the subject. VP Kamala Harris met Xi at the APEC summit and China has said it is open to a defence minister meeting in Cambodia this week.
Raphael Bostic sees an end in sight for the Fed’s tightening cycle. He stated that should economic indicators remain the same, this should only warrant an additional 1% of tightening.ASIA/PACIFIC
The Hang Seng plunged as much as 3.4% on Covid concerns after Hong Kong’s Chief executive tested positive, and Beijing saw three virus death, the first in six months. This also weighed on oil prices, with oil prices falling.ILS
Israel’s faster-than-expected inflation in October means that its not a question of if, but by how much the Bank of Israel will raise interest rates on Monday. Consumer prices rose an annual 5.1% last month, reversing a recent deceleration. Expectations are currently split between a 0.75% hike and the lesser 0.5% hike.Data & EventsIsrael Central Bank Decision
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