Sunak clear favourite among MPs to become next premier, Chinese equities fall following Xi’s leadership overhaul.
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October 24, 2022Rates are not real time. Rates are today's indicative mid-market rates as of time of publishing, which may vary. Please contact SVB for a current quote.
Source: Bloomberg
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GBP
Rishi Sunak’s odds of becoming the next British PM leaped forward as Boris Johnson withdrew from the contest despite having the required support. Penny Mordaunt is the only challenger now, if she fails to receive the backing of 100 MPs by this afternoon Sunak will automatically become PM. GBPUSD trades 0.43% higher following the news, whilst gilts surge higher.
EURThe ECB is heavily expected to deliver another 75-bps hike on Thursday as it focuses on inflation. Markets are wondering how far the ECB can continue their tightening cycle amid an energy-driven recession crisis which threatens to engulf the bloc. This could reinvigorate ECB doves whose appeals for caution in raising borrowing costs too hastily have been drowned out amidst record high inflation.
USDHeading into the US midterms an interesting poll has show that the public favour Republicans over Democrats on the economy 38%-24%, whilst the democrats have the edge on abortion 46%-25%.
As Fed policy makers entered a blackout period ahead of their Nov 1-2 meeting, there is plenty of data available. GDP figures on Thursday may show that the economy returned to growth following two periods of consecutive contraction, meanwhile the PCE report might show prices still gaining which could weigh on FOMC minds on their December decision.
ASIA/PACIFICChinese markets fell following Xi Jinping’s leadership overhaul. Xi has appointed close allies to oversee China’s key institutions effectively giving him more control in his third term. Most of these are advocates of the Covid Zero policy which has diminished any hopes of restrictions easing. The Hang Seng tumbled as the move alarmed investors whilst the offshore yuan fell to its weakest level since January 2008.
ILSIsrael’s consumer confidence fell to 70 in September from 78 in August, according to the Central Bureau of Statistics. USDILS trades 0.53% higher intraday.
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