In today's New York foreign-exchange market, dollar-yen is expected to move with the release of the core PCE deflator and GDP ahead, which will influence the outlook for a December rate hike.
In today's New York market, attention is shifting from US monetary-policy events to expectations for a December rate hike, with the focus initially on US economic data. The core PCE deflator and the preliminary July–September GDP reading are expected to be released early in the session, potentially affecting the market's rate-hike outlook.
The Federal Open Market Committee left the policy rate unchanged at 3.75%–4.00% the previous day. The decision passed by a majority, although some officials argued for a rate hike, and the statement added wording that the accumulation of more information would help guide policy decisions.
At a press conference, Fed Chair Warsh indicated that AI-related investment could affect interest-rate trends. Expectations for a rate hike next year are said to have receded, while some market participants believe the market is pricing in an approximately 80% probability of a December rate hike.
The core PCE deflator at 21:30 is expected to rise approximately 3.1% year on year, accelerating from 3.0% previously. The preliminary July–September GDP reading is expected to show annualized quarter-on-quarter growth of 3.2%, accelerating from 2.2% in the previous quarter. If the strength of prices and the economy is confirmed, expectations for a December rate hike may become more firmly established.
In the Canadian dollar, the Bank of Canada implemented a rate hike, raising the policy rate to 2.50%. Its quarterly Monetary Policy Report projected that inflation would rise to approximately 3.5% by the end of 2026 before returning by mid-2028, with the scope for further rate hikes to be assessed at each meeting.