GBP: The British Pound is struggling to gain traction this morning as cautious investors steer clear of the increasingly risk-sensitive UK currency. Market sentiment has shifted due to growing concerns over the escalating conflict in the Middle East. In the near term, the economic calendar remains relatively quiet, with investors awaiting the Bank of England’s Monetary Policy Report Hearings scheduled for tomorrow.

EUR: The Euro continued to decline yesterday as inflation in the Eurozone eased in September, dropping below the European Central Bank’s target. The Harmonized Index of Consumer Prices fell to 1.8%, down from 2.2% in August, marking its lowest level since April 2021. Looking ahead, investors are focusing on the upcoming EU unemployment rate and speeches from ECB officials.

USD: The U.S. Dollar regained some ground yesterday after Federal Reserve Chair Jerome Powell downplayed the likelihood of a significant interest rate cut. Looking forward, all eyes are on the monthly jobs report due on Friday. Weaker-than-expected data could reignite recession fears, while strong job growth might lead to concerns that the Fed may not cut rates as much as anticipated. Safe-Haven buying after rising escalations in the Middle East has also strengthened the USD.