Why October matters
October is packed with events that could move the pound and the euro, and most of the big ones fall in the final week of the month.
This is not a full list of every release. We have picked out the UK and eurozone events most likely to move the pound against the euro, plus the handful of US releases big enough to move all markets. Smaller releases are left out so the important dates stand out.
The UK Budget on 28th October is the headline.
But in the weeks before it, inflation and jobs figures on both sides of the Channel will shape what the Bank of England and the European Central Bank do next. France's budget debate adds a second political risk, this time for the euro.
But in the weeks before it, inflation and jobs figures on both sides of the Channel will shape what the Bank of England and the European Central Bank do next. France's budget debate adds a second political risk, this time for the euro.
If you only watch three dates, make them these:
- Friday 2nd October: eurozone inflation. The biggest euro number before the Budget.
- Wednesday 21st October: UK inflation. The figure most likely to decide whether the Bank of England raises rates in November.
- Wednesday 28th October: the UK Budget. The biggest single risk for the pound this autumn.
Below, we go through the month week by week, explaining what each event is and why it matters. Unless stated, UK releases come out at 7:00 am UK time, before the market is fully open, so the first reaction can be sharp.
Week 1 (1st to 9th October): eurozone inflation and central bank speeches
The first week is mostly about the euro, and about what central bankers say.
- Thursday 1st October: eurozone factory surveys and a busy day of speeches. The manufacturing surveys (PMIs) ask businesses whether activity is growing or shrinking, and a reading above 50 means growth. This morning's figures were slightly better than expected, which gives the euro a little support. ECB President Christine Lagarde speaks in the afternoon, along with Isabel Schnabel and François Villeroy, the head of France's central bank. Listen for any comment on France or on going slowly with rate rises. On the UK side, Catherine Mann of the Bank of England speaks. She is one of three members who voted to raise rates in September, so firm comments from her support the pound.
- Friday 2nd October: eurozone inflation (flash estimate for September). This is the most important euro number before the Budget. Inflation is forecast to jump to 3.6% from 3.2%, with core inflation (which strips out volatile energy and food prices) forecast at 2.5% from 2.4%. Higher inflation makes it more likely the ECB keeps raising rates, which supports the euro. A figure above forecast would be bad news for euro buyers. A figure below would help. The same afternoon, the US jobs report comes out. It mainly moves the Dollar, but a big surprise can shift the mood across all markets.
- Monday 5th October: eurozone services surveys. The same type of survey as above, this time for the services sector, which is the bigger part of the eurozone economy. These are final figures, so they rarely move markets unless they are revised sharply.
- Tuesday 6th October: Catherine Mann speaks again, plus eurozone retail sales and German factory orders. Eurozone shoppers cut spending by 0.6% in July. Another weak month would add to the picture of a sluggish eurozone economy.
- Wednesday 7th October: German industrial production. German factory output fell 1.1% in July. Germany is the eurozone's largest economy, and continued weakness there weighs on the euro over time. In the evening, the US Federal Reserve publishes the minutes of its last meeting.
- Thursday 8th October: ECB meeting accounts and a Bank of England speech. The accounts are a detailed record of the ECB's September discussion. They show how keen members are to keep raising rates. Clare Lombardelli, Deputy Governor of the Bank of England, also speaks, and eurozone finance ministers meet (Eurogroup), where France's finances may come up.
- Friday 9th October: EU finance ministers meet (EcoFin).
Week 2 (12th to 16th October): France's budget debate and UK growth
The focus shifts to France's politics and the health of the UK economy.
- Monday 12th to Sunday 18th October: IMF meetings. The International Monetary Fund holds its autumn meetings and updates its global growth forecasts. Any comments on UK or French government finances will be noticed by markets.
- Tuesday 13th October: French parliament begins debating the 2027 budget. This is the wildcard for the euro. France is borrowing heavily, and its parliament has no majority. If the debate goes badly and the government looks at risk of falling, investors could sell the euro quickly. A credible budget would ease the pressure. The same day, UK shop sales figures from the British Retail Consortium give an early read on UK consumers.
- Wednesday 14th October: US inflation. This mainly matters for the Dollar, but a high reading could push global borrowing costs up, including in the UK.
- Thursday 15th October: UK economic growth (GDP) for August. The UK economy grew 0.4% in July, a strong month. Another solid figure would back up the view that the UK is outperforming, which has helped the pound recently. A weak figure would suggest the slowdown many economists expected is finally arriving.
- Friday 16th October: final eurozone inflation figures for September. These confirm the early estimate published on 2nd October. They only move markets if they differ from it.
Week 3 (19th to 23rd October): UK jobs, inflation and the last data before the Budget
This is the most important week for UK data. It will largely decide whether the Bank of England raises interest rates on 5th November.
- Tuesday 20th October: UK jobs and wages. Unemployment is at 4.9%, and pay excluding bonuses is growing at 3.5% a year. If unemployment rises, the Bank of England is less likely to raise rates, which would weigh on the pound. Strong pay growth does the opposite, because it keeps inflation pressure high. Germany's ZEW survey of investor confidence is out the same morning.
- Wednesday 21st October: UK inflation for September. The key UK number of the month. Inflation is at 3.1%, and the Bank of England expects it to rise towards 3.75% by the end of the year because of higher energy prices. A figure above expectations would make a November rate rise very likely, which usually supports the pound. A figure below expectations could take the rate rise off the table, and the pound would likely fall. Core inflation, which strips out energy and food, is at 2.6% and is worth watching too.
- Thursday 22nd October: eurozone consumer confidence. A quick read on how eurozone households are feeling. Confidence is weak, at -16.5.
- Friday 23rd October: UK retail sales, consumer confidence and business surveys for both the UK and eurozone. These are the last important figures before the Budget. Consumer confidence (GfK) is at -13, and retail sales rose 0.5% in August. The early October business surveys (flash PMIs) are the most up-to-date read on both economies, so a clear gap between UK and eurozone readings could move GBP/EUR going into Budget week.
Week 4 (26th to 30th October): Budget, Fed and ECB in three days
The final week packs the three biggest events of the month into three days. Exchange rates can move sharply, and the gap between buying and selling prices tends to widen on Budget day.
- Tuesday 27th October: German business confidence (IFO). Germany's best-known business survey. It is weak, at 89.9, and a further fall would add to concerns about the eurozone's largest economy. The ECB also publishes its survey of bank lending.
- Wednesday 28th October: the UK Autumn Budget. The biggest single risk for the pound this autumn. Chancellor John Healey delivers his first Budget at around midday, alongside updated forecasts from the Office for Budget Responsibility. Higher borrowing costs have roughly halved the government's safety margin against its own spending rules, from £23.6 billion to around £12 billion. Borrowing costs rose sharply again around the world on 1st October, which could squeeze that margin further. Investors want to see how he rebuilds it without the big tax rises Labour has ruled out. A Budget seen as credible could bring relief for the pound. One that relies on more borrowing or optimistic assumptions could see the pound and UK government bonds fall together. In the evening, the US Federal Reserve announces its interest rate decision.
- Thursday 29th October: European Central Bank interest rate decision. The ECB raised rates to 2.50% in September. It now has to balance higher inflation, which argues for more rate rises, against France's debt worries and a weak German economy, which argue for caution. A cautious ECB would weigh on the euro. Because it comes the day after the Budget, the two events could add up to a big move in GBP/EUR either way.
- Friday 30th October: eurozone growth and inflation. The first estimate of eurozone growth for July to September (the eurozone grew 0.3% in the previous quarter), and the first inflation figures for October. A strong end to a busy week could set the tone for the Bank of England's decision the following Thursday.
Looking ahead: Thursday 5th November
- Bank of England interest rate decision. The Bank held rates at 3.75% in September, but three of its nine members voted for a rise, and markets now expect an increase to 4% in November. Everything in October, especially UK inflation on 21st October and the Budget on 28th October, feeds into this decision. A rate rise would usually support the pound. If October's figures disappoint and the Bank holds, the pound could lose some of the support it has enjoyed.
October is a month where a lot can change quickly, and much of the risk is bunched into the last week. For a business buying or selling euros, the question is not whether the rate could improve, because it might. It's whether waiting is worth the risk to your costs and margins on payments you already know are coming.
There are practical ways to manage this. You can fix the rate on part of your upcoming payments now, set up orders that act automatically if the market reaches a level you are comfortable with, or protect yourself against a fall while keeping the chance to benefit if the rate improves.
For a fuller look at what is driving the pound and the euro, see our main piece: GBP/EUR Ahead of the Autumn Budget.
If you would like to talk through how these events could affect your business, please speak to the Lamera dealing team.
This article provides general market information and is not a recommendation based on your individual circumstances. Please speak to us before making any decisions.
If you would like to talk through how these events could affect your business, please speak to the Lamera dealing team.
This article provides general market information and is not a recommendation based on your individual circumstances. Please speak to us before making any decisions.