FX round-up: Yen keeps gaining, emerging markets in focus
A weaker than expected reading on the Eurozone’s core rate of inflation walloped the euro/dollar.
The latest Eurozone consumer price data from Eurostat showed that the core rate of inflation unexpectedly fell in September, to reach a 0.7% year-on-year pace. That was two tenths of a percentage point less than had been expected.
Euro/dollar fell back promptly in reaction to those numbers, ending the day at 1.2630, albeit after hitting an intra-day low of 1.2571.
In the UK, revised data incorporating an updated methodology revealed that Britain's gross domestic product in fact grew by 0.9% quarter-on-quarter in the three months to June, slightly ahead of the 0.8% gain which had been forecast.
Nevertheless, cable continues to trade quite weakly and was off slightly to 1.6213 by the end of the session, after having lost 0.18%.
Worth pointing out, there was a fair bit of commentary out and about regarding the potential risk for capital outflows from emerging markets as the Fed moves to raise rates.
In that regard, in the latest edition of its World Economic Outlook the IMF highlighted the vulnerability of some of those smaller economies.
Nevertheless, the Washington-based lender highlighted how global current account imbalances had narrowed substantially versus pre-crisis levels.
Dollar/yen ended the day higher, by 0.21% to 109.65, despite the somewhat mixed economic data to be seen Stateside and after the Japanese Ministry of Economics revealed the country’s industrial production fell by a far larger than expected 1.5% month-on-month in August.