Negative NY Fed Index Pressures Dollar


Stock index futures are higher despite mixed earnings results from big banks.

European stock markets gained traction, as investors welcomed news that U.K. Chancellor Jeremy Hunt is reversing almost all of the tax measures set out in Prime Minister Truss’s mini-budget.

worker carrying box

The October Empire State Manufacturing index was negative 9.1 when negative 2.5 was expected, and compared to last month’s figure of negative 1.5. The New York Federal Reserve conducts this monthly survey of manufacturers in New York state, which represents a variety of industries.

The technicals are becoming more supportive.


The U.S. dollar index depreciated sharply against the British pound after the new U.K. chancellor  reversed most of the mini-budget, reassuring markets that the U.K. will return to a more sustainable borrowing path.

The U.S dollar has been underperforming the news in recent weeks.

The International Monetary Fund said it would be right for the European Central Bank to “normalize its monetary policy by the end of the year and then tighten next year,” despite weaker economic prospects.

The Japanese yen remains near the 32-year lows seen last Friday as the market weighs the prospect of the Bank of Japan intervening again. It is almost a month since Japanese authorities sold the U.S. dollar and bought yen to provide some price stability for the currency. At that time the high had been 145.90 and it is now trading above 148, as the market focuses on the psychologically significant level at 150.

Bank of Japan Governor Kuroda recently said it is not appropriate for Japan to raise interest rates now.


Futures are being supported by the substantially weaker than anticipated October Empire State Manufacturing index.

According to financial futures markets, there is a 95.0% probability that the Federal Open Market Committee will increase its fed funds rate by 75 basis points at the November 2 policy meeting and a 5.0% probability that the rate will be hiked by 50 basis points.

Last Thursday there was a 2.0% probability that the FOMC could hike its fed funds rate by 100 basis points.


Interested in more futures markets?  Explore our Market Dashboards here.

Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.

ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.                  

A subsidiary of Archer Daniels Midland Company.

© 2021 ADM Investor Services International Limited.

Futures and options trading involve significant risk of loss and may not be suitable for everyone.  Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.  The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM.  The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared.  The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.

Latest News & Market Commentary

Explore the latest edition of The Ghost in the Machine

Explore Now