Daily Market Pulse

Final full week of the presidential election campaign


Although 3Q GDP is widely expected to be strong, as lockdown measures were eased and the reopening of businesses boosted economic activity in the period, it may have a muted impact on the USD price in this upcoming week. Investors might be looking ahead for a Q4 trend as unemployment claims are still high and Covid-19 cases are rising. The debate over whether the Democrats and the White House can finally agree on another fiscal stimulus will remain a key theme. Finally, this week is the final full week of the presidential election campaign, with both candidates likely to make an effort to boost turnout at the polls next Tuesday (Nov. 3). Key figures coming up:

  • On Monday (26/10): New Home Sales (Sep)
  • On Tuesday (27/10): Durable Goods Orders (Prelim, Sep) | Consumer Confidence Index (Oct) | Richmond Fed Manufacturing Index (Oct)
  • On Wednesday (28/10): Wholesale Inventories (Prelim, Sep)
  • On Thursday (29/10): GDP (3Q) | Initial Jobless Claims
  • On Friday (30/10): Personal Spending (Sep) 


Last Friday, IHS Markit Flash Eurozone PMI signaled a renewed economic downturn at the start of Q4. According to the report, business activity fell back into decline across the Eurozone in October as accelerating growth of manufacturing output was overwhelmed by a steepening deterioration in the service sector amid rising COVID-19 worries. With Germany being the only bright spot, while France and the rest of the region as a whole fell deeper into decline. However, this week, GDP data for the Eurozone, Germany, France, Italy, and Spain will certainly show strong rebounds after the collapse seen in the second quarter, but the market’s focus will be on how the ECB’s Governing Council assesses downside risks to the outlook on Thursday. Also, inflation and unemployment data will give a sense of where things were headed ahead of the second wave and new restrictions that have made the outlook all the more uncertain. Key figures coming up:

  • On Monday (26/10): Germany Ifo surveys (Oct)
  • On Tuesday (27/10): Spain unemployment rate (Q3) | France jobless benefit claims and jobseekers total (Sep)
  • On Wednesday (28/10): France consumer confidence (Oct) | Spain retail sales (Sep)
  • On Thursday (29/10): Germany jobless rate (Oct) and inflation (Prelim, Oct) | ECB monetary policy decision
  • On Friday (30/10): Euro area, France, Germany, Spain, Italy GDP (Prelim, Q3)


Similar to Eurozone PMI, the pace of UK economic growth slowed in October to the weakest since the recovery from the national Covid-19 lockdown began. Unsurprisingly the weakening is most pronounced in the hospitality and transport sectors, but with manufacturing holding up significantly better than the more services sector. Meanwhile, the Brexit trade deal was given a lifeline after both sides agreed to intensify the talks, but it might take yet another two-three weeks. Sterling might price the large challenges for the UK as they leave the single market behind (poor productivity and inflationary developments). Key figures coming up:

  • On Tuesday (27/10): BRC Shop Price Index | CBI Distributive Trades Survey (Oct)  
  • On Thursday (29/10): Nationwide housing prices (Oct) | Mortgage approvals and lending (Sep) | BoE consumer credit (Sep)
  • On Friday (30/10): GfK Consumer Confidence


The Bank of Japan (BoJ) is expected to keep unchanged its interest rate, also the BoJ is expected to downgrade its growth forecasts at its upcoming policy meeting on Thursday. On the economic data front, it will be a busy week, with market participants watching the Unemployment report on Thursday, which might show the fourth month of marginal deterioration after the unemployment rate edged up to 3.0% in August 2020 compared to 2.9% in the prior month. Also, the market’s attention will turn to Housing Starts and Construction Orders on Friday. Key figures coming up:

  • On Wednesday (28/10): Retail sales (Sep)
  • On Thursday (29/10): BoJ interest rate decision | Quarterly outlook report | Consumer confidence (Oct) | Jobless rate (Sep) | Industrial output (Prelim, Sep)
  • On Friday (30/10): Housing starts (Sep) | Construction orders (Sep)


The key policy event this week for Canadian participants will be the Bank of Canada’s (BoC) rate decision on Wednesday. The BoC policy meeting is expected to deliver no additional stimulus with the policy rate left at 0.25%. Following, On Friday, investors will be looking at prices of raw materials purchased by manufacturers, as well as the prices for products manufactured. Both figures remain under pressure, and there are no material signs of rising inflation, which could raise concerns over the country’s economic recovery. Key figures coming up:

  • On Wednesday (28/10): BoC Interest Rate Announcement
  • On Friday (30/10): Industrial Product Price Index (Sep) | Raw Materials Price Index (Sep) | Real GDP (Aug)


It will be another quiet week, with market participants watching the Trade Balance data on Tuesday, which might show another month of surplus after Mexico registered the largest surplus on record in August. Also, the market’s attention will turn to Mexican GDP on Friday. Some market’s forecasts show Mexican Q3 GDP to shrink at a slower pace of -10.6% y/y following a contraction of nearly 19% in Q2. Looking ahead, risks stemming from rising Covid-19 cases, futures oil prices, and the outlook for the U.S economy will continue to be assessed over Q4 for evidence of economic resilience. Key figures coming up: 

  • On Monday (26/10): Economic Indicator IGAE (Aug)
  • On Tuesday (27/10): Trade Balance (Sep)
  • On Friday (30/10): GDP (Prelim, 3Q)


President Xi Jinping and members of the Central Committee will map out the country’s economic course for 2021-2025 at a key meeting starting today, seeking to balance growth and reforms to avoid stagnation amid an uncertain global outlook. Further explanations on the CNY’s value and financial system strategy will also be sought to assess China’s role in the global economy in the coming years. Market participants will also pay attention to Industrial profits, which will also provide clues concerning the health of the Chinese economy. Key figures coming up:

  • On Monday (26/10): China CCP Central Committee Fifth Plenum (26-29 Oct)
  • On Tuesday (27/10): Industrial profits (Sep)
  • On Friday (30/10): Composite PMI (Oct) | Manufacturing PMI (Oct) | Non-Manufacturing PMI (Oct) | Caixin Manufacturing PMI (Oct)


There is consensus among market participants that there will be no change in the 2% Selic rate on Wednesday, with it remaining at historical lows. However, the market begins to show insecurity concerning Brazil’s central bank (BCB) decision after a higher and widespread inflationary acceleration than the BCB had anticipated. A faster-than-anticipated recovery and a pick-up in headline and core CPI provide room for revaluation of monetary policy in the next BCB’s meeting. On the economic front, investors will keep a close eye on the IGP-M Inflation Index and Debt-to-GDP ratio figures, which are expected to be released on Thursday. Key figures coming up:

  • On Monday (26/10): Bank lending (Sep)
  • On Wednesday (28/10): BCB Interest Rate Announcement
  • On Thursday (29/10): IGP-M Inflation Index (Oct) | Debt-to-GDP ratio (Sep)
  • On Friday (30/10): Product Price Index (Sep) | Unemployment rate (Oct)

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