Dear Reader,

Today's overview of economic news and market action:

• • Mixed mood on markets yesterday …
  • Having initially moved higher, weak PMI data weighed on the euro …
  • Reflected by EUR/USD rising to $1.069 yesterday, before falling to $1.06 at the close …
  • Elsewhere, GBP/USD is operating back below the $1.22 handle … 
  • EUR/GBP remains in and around the 87p threshold …
  • Relatively quiet data schedule ahead today

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.