Another inflation surprise

Today's news headlines: 

‘Inflation in US builds with biggest gain in prices since 1990’. The US Consumer Price Index rose 6.2% in the year to October 2021, marking the fastest annual rise in three decades. Yesterday’s data adds pressure on the Federal Reserve to increase the pace of tapering bond purchases or consider raising interest rates at their next meeting on December 15th, quicker than previously expected. Following the release, President Biden said, ‘reversing this trend is a top priority for me’, noting the administration is working on ways to reduce the burden of rising energy prices on households. (Bloomberg)

‘US-China Climate Deal Breaks Through Superpower Standoff’. During the final days of global climate negotiations, the world’s two biggest economies agreed to cut emissions and tackle methane and illegal deforestation, marking a rare display of cooperation between the two geopolitical rivals. While both countries reaffirmed the Paris accord temperature goals, China declined to join a global commitment to cut methane emissions 30% by 2030, noting China will develop its own national plan. (Bloomberg) 


Treasury yields continued to climb yesterday evening following the US inflation release, while the US Dollar Index extended gains. European equities open in the green on Thursday following gains in Asian equities overnight led by China.


Australia Unemployment Rate: 5.2% vs 4.6% previously
UK preliminary Gross Domestic Product q/q: 1.3% vs 2.7% previously (revised)
UK preliminary GDP Growth Rate y/y: 6.6% vs 23.6% previously
UK Industrial Production YoY: -2.9% vs 4.0% previously (revised)
UK Manufacturing Production YoY: -2.8% vs 4.2% previously
EU economic forecasts: 10:00AM
US Bank Holiday: All day
Canada Bank Holiday: All day

Interbank rates:

GBP/USD – 1.3377
GBP/EUR – 1.1676
EUR/USD – 1.1456
USD/CAD – 1.2528

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