Here’s what you need to know on Wednesday, October 30:
Action in currency markets remains quiet early Wednesday as investors prepare for the release of key macroeconomic data. Highlights on the European economic agenda include inflation and Gross Domestic Product (GDP) data from Spain, Italy and Germany, as well as GDP figures from the Eurozone. Later in the day, investors will closely monitor US ADP employment change data and the US Bureau of Economic Analysis will release the first estimate of third-quarter annualized GDP growth.
After rising during European trading hours on Tuesday, the US Dollar Index (USD) lost traction due to disappointing JOLTS Job Openings data for September and closed the day virtually unchanged. Early on Wednesday, the index continues to move sideways above 104.00. Meanwhile, US stock index futures are trading slightly higher following the mixed action seen on Wall Street on Tuesday. The US GDP report will also include quarterly readings of the Personal Consumption Expenditure (PCE) Price Index.
US Dollar PRICE This Week
The table below shows the percentage change of the US Dollar (USD) against major currencies this week. US dollar was the strongest currency against the Australian dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.28% | -0.40% | -0.02% | 0.16% | 0.77% | 0.25% | -0.19% | |
| EUR | 0.28% | 0.00% | 0.18% | 0.44% | 1.13% | 0.51% | 0.11% | |
| GBP | 0.40% | -0.00% | 1.02% | 0.56% | 1.18% | 0.62% | 0.37% | |
| JPY | 0.02% | -0.18% | -1.02% | 0.24% | 0.14% | -0.48% | -0.64% | |
| CAD | -0.16% | -0.44% | -0.56% | -0.24% | 0.56% | 0.02% | -0.31% | |
| AUD | -0.77% | -1.13% | -1.18% | -0.14% | -0.56% | -0.63% | -1.00% | |
| NZD | -0.25% | -0.51% | -0.62% | 0.48% | -0.02% | 0.63% | -0.44% | |
| CHF | 0.19% | -0.11% | -0.37% | 0.64% | 0.31% | 1.00% | 0.44% |
The heat map shows percentage changes for major currencies. The base currency is selected from the left column, while the quote currency is selected from the top row. For example, if you choose the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change shown in the box will represent USD (base)/JPY (quote).
EUR/USD fell below 1.0800 on Tuesday, but staged a rebound in the American session to end the day flat. The pair remains stable around 1.0820 as the European session begins. In addition to the data mentioned above, the European Commission will publish business and consumer sentiment figures for October.
GBP/USD recorded small gains and closed above 1.3000 on Tuesday. The pair remains in a consolidation phase early on Wednesday. The UK government will publish the Autumn Forecast Statement and present the Autumn Budget later in the day.
During Asian trading hours, data from Australia showed that the Consumer Price Index (CPI) rose 0.2% on a quarterly basis in the third quarter. This reading followed the 1% increase recorded in the second quarter and was slightly below the market expectation of 0.3%. On an annual basis, the CPI rose 2.8%, compared to analysts’ estimate of 2.9%. AUD/USD remains under modest bearish pressure and is trading near 0.6550 in European morning trading on Wednesday.
USD/JPY failed to gather directional momentum and ended the day flat on Tuesday. The pair remains relatively calm early on Wednesday and fluctuates in a narrow band above 153.00.
Gold gained bullish momentum and gained more than 1% on Tuesday. XAU/USD continues to rise towards $2,800 and trades at a new all-time high on Wednesday.
The GDP FAQs
The Gross Domestic Product (GDP) of a country measures the growth rate of its economy over a given period of time, usually a quarter. The most reliable figures are those that compare GDP with the previous quarter (for example, the second quarter of 2023 with the first quarter of 2023) or with the same period of the previous year (for example, the second quarter of 2023 with the second quarter 2022).
Annualized quarterly GDP figures extrapolate the quarter’s growth rate as if it were constant for the rest of the year. However, they can be misleading if temporary shocks hit growth in one quarter but are unlikely to last all year, as was the case in the first quarter of 2020 with the outbreak of the coronavirus pandemic, when growth plunged.
A higher GDP result is typically positive for a nation’s currency as it reflects a growing economy, which is more likely to produce goods and services that can be exported, as well as attract greater foreign investment. Likewise, when GDP falls it is usually negative for the currency.
When an economy grows, people tend to spend more, which causes inflation. The country’s central bank then has to raise interest rates to combat inflation, with the side effect of attracting more capital inflows from global investors, which helps the local currency appreciate.
When an economy grows and GDP increases, people tend to spend more, which causes inflation. So, the country’s central bank has to raise interest rates to combat inflation. Higher interest rates are negative for Gold because they increase the opportunity cost of holding Gold versus placing money in a cash deposit account. Therefore, a higher GDP growth rate is usually a bearish factor for the price of Gold.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
