Garton Global | Monthly Market Digest
Sterling remained under pressure in October as cooling inflation and fiscal jitters weighed on sentiment, while the US dollar proved resilient amid political turbulence and steady economic data. Commodities swung sharply, with record gold highs and renewed trade war fears adding to volatility. Heading into November, all eyes turn to Rachel Reeves’ make-or-break Budget, central bank divergence, and Trump-driven geopolitical risks set to define the next leg for currencies and commodities.
Check your positioning and speak to the Garton Global team today.
LAST MONTH: OCTOBER
🇬🇧 Sterling Under Pressure – Fiscal Fears and Rate Cut Bets
● The pound slid as inflation cooled to 3.8%, fuelling bets on a BoE rate cut before year-end.
● Fiscal jitters grew ahead of Reeves’ November 26 Budget amid worsening borrowing forecasts.
● Sterling stayed weak as markets braced for potential tax hikes and spending restraint.
🇺🇸 USD Resilience Despite Political Noise
● The dollar held firm despite shutdown threats and Trump-driven political volatility.
● Safe haven demand and solid US data kept it supported through October.
● Modest inflation surprises reinforced confidence in US economic strength.
🌍 Global Realignment – Energy, Gold & Trade Shocks
● Gold hit record highs above $4,300 before a sharp 5% correction; oil tumbled on supply fears.
● Trump’s tariff threats reignited global trade war concerns.
● China boosted renminbi lending to cut dollar reliance, deepening global realignment.
THIS MONTH: NOVEMBER
🇬🇧 Make-or-Break Moment for Sterling
● Reeves’ November 26 Budget is the key domestic risk for GBP.
● Markets eye tax hikes, spending cuts, and fiscal credibility.
● A misstep could spark a gilt and currency sell-off.
🏦 Central Bank Divergence
● BoE is likely to cut before year-end; Fed and ECB may hold steady.
● US data will guide Fed timing on 2026 rate cuts.
● Policy divergence to drive GBP/USD and EUR/USD moves.
🌍 Geopolitical Wildcards: Trade Wars, Peace Deals, Elections
● Trump’s tariff threats and Russia talks keep volatility high.
● Middle East and China developments could sway risk appetite.
● Markets remain alert to shocks hitting oil, bonds, and gold.
Have a great month,
The Garton Team.