Election eve is upon us, RBA tipped to slash rates

November 3, 2020

The last day of campaigning in the US election is underway, while Australia’s central bank meets today.

Currencies were muted to start the week as all eyes focus on the US election. The EURUSD opened Monday at $1.16461 and slid to lows of $1.16212 mid-session. Bouncing off those lows, the euro crept up to a high of $1.16553. It gave up some of those gains late in the day and is now trading at $1.16419. The GBPUSD opened the week at $1.29189 and fell to lows of $1.28535 mid-session. It quickly rebounded, hitting highs of $1.29417 heading into late trading. It has come off those highs and is now trading at $1.29234.

Indices finally turned it around overnight, erasing some of the heavy losses sustained last week. The Dow began the week at 26,459.22 and dipped to lows of 26,275.58 in the first hour. It rallied of those lows, peaking at 27,045.38 late. It is currently at that same level. The Dax followed suit when it started the week at 11,572.50. After slipping to an opening-hour low of 11,504.68, the German index marched its way to a late high of 11,836.70. It has continued that momentum in early Tuesday trading and is currently at 11,856.80.

The day ahead sees focus remain on the US election, which is entering its final stages. Already, more than 100 million people have voted early in an election which is shaping up to be a vital one as both candidates offer very different policy platforms and ideological directions. Elsewhere, the RBA meets today to discuss interest rates. It is tipped that Australia’s central bank will slash interest rates from 0.25% to 0.1%. There is also speculation that the RBA will embark on its own QE program.

Data published today includes:

US – Factory Orders, IBD/TIPP Economic Optimism

Europe – French Government Budget Balance, Swiss CPI

 

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