Dear Reader,

Today's overview of economic news and market action:

• • Mixed tone to investor sentiment yesterday.
  • On bond markets, higher US yields attracted buying activity
  • Resulting in yields moving lower, with US 10-year yield back below 4.9%
  • Currency-wise, dollar was weaker amid the fall in Treasury yields
  • EUR/USD opens above the midpoint of $1.06-1.07
  • Elsewhere, EUR/GBP continues to straddle the 87p mark
  • Ahead today, flash PMIs for October are the key data highlight

Back in the Pack

Fears that the UK could have entered recession by now have not come to pass, with the economy displaying unexpected resilience over the past year.

Continuing Large Budget Surpluses

In recent years, the Irish public finances have been faced with the need to provide for short-term but often substantial government expenditure policy responses to a number of external shocks, including Brexit, COVID-19 and both the Ukrainian humanitarian and Cost of Living crises.

 Strong Public Finances

Today’s budget contained a fresh package of cost of living support measures totalling €2.7bn that will be rolled out over the winter months. These are mainly taking the form of direct household payments and energy credits. The Government is also providing an additional €6.4bn in other spending increases and tax cuts for next year. 

PMI declined to 49.6 in Sep, indicating business conditions deteriorated slightly. New orders fell, including export orders. Output contracted for a seventh month running.