While we wait until the final votes are called in the U.S. elections, traders will likely turn their focus on the Bank of England (BOE)’s policy announcement.
Can the central bank’s decision push GBP/NZD from a support level?
Check out the top headlines of the Asian session if you’re planning on opening trades during the London session:
- S&P 500 futures rise as U.S. election suggests less regulatory risk
- China suspends entry of non-Chinese nationals from UK as infections rise
- NZ ANZ business outlook little changed from October
- Australia posts largest trade surplus in 3 months
- Japan’s October services sector moves closer to stabilisation – PMI
- Investors welcome U.S. election gridlock, retreat from ‘blue wave’ bets
- Australia, New Zealand dollars shunted by U.S. vote jitters
- Dollar dips in nervous trade as Biden inches closer to White House
Upcoming Potential Catalysts on the Economic Calendar:
- Switzerland’s SECO consumer climate at 6:45 am GMT
- Germany’s factory orders at 7:00 am GMT
- BOE’s policy statement at 7:00 am GMT
- BOE Governor Bailey to give a speech at 7:30 am GMT
- U.K.’s construction PMI at 9:30 am GMT
- Eurozone retail sales at 10:00 am GMT
- EU’s economic forecasts due today
- U.S. initial jobless claims at 1:30 pm GMT
What to Watch: GBP/NZD
The pound lost pips across the board earlier today when word got around that the BOE is still considering negative interest rates.
It also didn’t help that markets widely expect Governor Bailey and his team to expand their asset purchasing programme by 100B GBP in November.But the Kiwi didn’t go unscathed, at least against its other counterparts. See, uncertainty over the U.S. elections are still weighing on the high-yielding comdolls.
If the BOE members project an optimistic tone despite their additional easing, or if they continue to shrug off negative rate policies in the foreseeable future, then we could see the pound pop up above the 1.9500 handle against the Kiwi.
But if risk appetite in the equities markets translates to demand for the comdolls, or if Bailey and his friends are more pessimistic on the economy than they were last month, then GBP/NZD could revisit areas of interest closer to 1.9200 or 1.9150.