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Forex Today: Inflation revolves at record highs, triggers run to safety

What you need to take care of on Thursday, October 20:

A souring market mood benefited the American Dollar on Wednesday, which extended its latest advance against its major rivals.

The day rotated around fresh inflation reports that reminded market players of the high risk of an upcoming global recession. The European Union published the second estimate of the September Consumer Price Index, which was downwardly revised to 9.9% YoY, barely below the 10% previously estimated. Core inflation was confirmed at 4.8%.

The United Kingdom also released the September annual CPI, which surged by 10.1% YoY, higher than the previous 9.9% and also above the 10% expected, a fresh multi-decade high. The reading, which excludes volatile food and energy prices, rose by 6.5% in the year to September, surpassing the previous 6.3%.

Finally, the Canadian CPI contracted in September, up 6.9% YoY from 7.0% in August. The Bank of Canada's core CPI, however, unexpectedly climbed to 6.0%.

Stubbornly high inflation revived recession-related concerns, as most central banks from around the globe are focused on taking it down, regardless of their actions' negative effects on economic growth. Persistent price pressures hint at continued aggressive quantitative tightening.

Meanwhile, the US Federal Reserve’s Beige Book showed that pessimism increased amid weakening demand and as price growth remained elevated, further fueling markets’ concerns.

European and American indexes closed in the red, reflecting market concerns. Government bond yields, on the other hand, surged, with the US 10-year Treasury note yield reaching to 4.13% and the 2-year note yield peaking at 4.55%.

The EUR/USD pair finished the day around 0.9770, while GBP/USD settled at 1.1215. The AUD/USD is currently trading at 0.6260, while USD/CAD is marginally higher, at 1.3770. The USD/JPY pair trades at a fresh multi-year high, not far from the 150.00 threshold.

Gold came under strong selling pressure and currently changes hands at $1,629. Crude oil prices, on the other hand, managed to recover some ground, and WTI is now at $84.30 a barrel.

The upcoming Asian session will bring the Australian monthly employment report.

Polkadot beats Ethereum, Solana and Bitcoin in terms of development activity 


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