Broader Price Action Driven By U.S. Elections, GBP Takes Hit From BoE Easing Chatter

Election dynamics remained front and centre. Early trade saw a degree of risk aversion, as the lack of a "Blue Wave" was coupled with mounting legal challenges to election results filed by the Trump campaign. Risk breathed with relief as the perceived chance of Biden winning the White House continued to firm up, e-minis staged another tech-driven uptick, while the potential of Trump's legal action to move the needle in his favour was widely played down.

• Aforementioned factors were assessed and G10 crosses partially retraced initial risk-off moves, with a round of unwinding seen coinciding with an uptick in e-minis. This leaves us with a somewhat mixed picture across the space, as JPY & NOK outperform and AUD, USD & GBP lag behind. The yen managed to cling onto gains, even as it is a Gotobi day in Japan.
• Speculation surrounding potential easing measures to be deployed at today's BoE meeting dealt a blow to GBP early into the Asia-Pac session. The Telegraph reported that policymakers are considering negative interest rates, while the Sun cited unnamed sources suggesting that the Bank will boost its QE programme by GBP150bn and potentially as much as GBP200bn, i.e. more than expected by most analysts.
• USD/CNH peeked under its 28-month low early on, before bouncing off there and recouping half of the losses registered yesterday, when it charted its widest range in five years. A marginally weaker than exp. PBoC fix provoked little to no immediate reaction.
• Central bank activity picks up today, with monetary policy decisions from the FOMC, BoE & Norges Bank & speeches from a number of ECB members due. Today's data highlights include U.S. initial jobless claims, German factory orders & EZ retail sales.