The European Central Bank kept policy unchanged, but officials hinted at a possible rate increase in December, while equities and commodities reacted to mixed US data and geopolitical tensions.

The European Central Bank left its key interest rate unchanged on Thursday, a move that was broadly expected. However, President Christine Lagarde’s remarks carried a hawkish tone, noting that energy‑price spillovers were still feeding inflation. In the background, ECB insiders reportedly see a rate hike in December followed by a pause, adding a layer of uncertainty for the euro.

Market reaction to the ECB decision

• The euro fluctuated throughout the session, shedding early losses to close modestly higher.
• Gold slipped $44 to $4,022 an ounce as higher yields and a stronger dollar pressured safe‑haven demand.
• Oil prices fell 0.46% to $102.32 a barrel amid easing concerns after reports of Iranian attacks on shipping near Hormuz.

US data and equity performance

• US initial jobless claims came in at 194,000, below the 199,000 forecast, while September core PCE inflation rose 0.5% month‑on‑month, outpacing the 0.3% consensus.
• The S&P 500 edged down 0.3% and the Nasdaq slipped 1.4% after Alphabet posted a 12.5% post‑market decline on earnings that highlighted AI competition in search.
• Eli Lilly rallied 6.5% to a record high on robust weight‑loss drug results, helping the Russell 2000 rise 0.7% as advancers outnumbered decliners.

What traders are watching next

• Key resistance for the euro around 1.0800 and support near 1.0700.
• US Treasury yields, especially the 10‑year benchmark, which fell to 4.98% after the data release.
• Potential geopolitical escalation after recent Iranian attacks on vessels near the Strait of Hormuz, which could reignite oil volatility.

Related news

• Gold retreats as US GDP exceeds estimates
• U.S. GDP grows 3.4% in Q3 as September inflation picks up
• Lagarde steps down early as ECB eyes growth boost
• Bitcoin jumps to $81.5K as US GDP beats expectations

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This article is compiled from international market news for information only. It is not investment advice.