Today's news headlines:
'Rishi Sunak replaces third of Liz Truss's Cabinet as he vows to fix mistakes of her premiership'. Prime Minister Rishi Sunak overhauled his Cabinet yesterday, bringing in eight MPs that served during Boris Johnson's premiership. Sunak was critical of Liz Truss's performance, pointing to the economic damage and uncertainty that recent fiscal decisions had brought to the UK. Suella Braverman, Home Secretary under Liz Truss, was reinstated despite quitting just one week ago after reportedly breaking the ministerial code. (Bloomberg)
'Hedge funds are slashing leverage to weather market slump'. Portfolio leverage has been slashed this year by around 20% as hedge funds try to cope with tighter monetary policy conditions and an economic slowdown in most major economies. The cost of leverage has jumped as markets move away from a record-low interest rate environment with inflation at multi-decade highs. Morgan Stanley has reportedly reduced its margin exposure to certain clients, indicating that liquidity offerings are also drying up. (Bloomberg)
Asian indices climbed overnight as the People's Bank of China vowed to maintain a healthy development of markets. European shares followed suit, while US equity futures declined in early trade. The Pound continues to strengthen today as the market shakes off the Liz Truss premium that was baked into UK financial assets just last week.
Australia CPI QoQ (3Q): 1.8% (est. 1.6%)
US Preliminary Wholesale Inventories MoM (Sep): 1:30PM
Bank of Canada Monetary Policy Report: 3:00PM
US New Home Sales (Sep): 3:00PM
Bank of Canada press conference: 4:00PM
GBP/USD – 1.1514
GBP/EUR – 1.1526
EUR/USD – 0.9991
USD/CAD – 1.3580
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*Indicative interbank rates taken on the day of writing. Please speak to your Dealer to find out the current rates available for you.