FED: Bowman Maintains Firmly Dovish Stance In Rare Update

• EUR/USD: $1.1550(E1.9bln), $1.1600(E1.3bln), $1.1700(E1.4bln), $1.1735(E1.2bln), $1.1745-50(E3.3bln), $1.1797-00(E1.2bln), $1.2000(E1.9bln)
• USD/JPY: Y155.00($3.4bln), Y156.00($3.1bln), Y156.25($2.3bln), Y157.00($4.2bln), Y158.00($5.0bln), Y158.50($1.9bln), Y159.00($6.5bln)
• GBP/USD: $1.3600(Gbp570mln)
• AUD/USD: $0.6540-50(A$1.6bln), $0.6665-75(A$1.3bln)
• AUD/NZD: N$1.1410(A$1.5bln)

Forecasts from INSEE's Economic Outlook Note: "Activity is expected to slow slightly at the end of the year (+0.2%), as the summer's aeronautical boom cannot be repeated, but growth should stabilize in the first half of 2026 at a rate close to the 2010 average (+0.3% per quarter). French growth (adjusted for working days) would thus reach +0.9% in 2025 and would already show +1.0% momentum by mid-year for 2026"

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Eurozone labour cost index growth (calendar, not seasonally adjusted) eased to 3.3% Y/Y in Q3, down from a three tenth upwardly revised 3.9% in Q2. That provides some dovish offset to the stronger-than-expected compensation per employee reading in the Q3 national accounts (4.0% Y/Y vs 3.2% ECB projections, 4.0% prior). 

• However, as indicated by the Q2 reading, the labour cost index can be revision prone, so we are hesitant to lean on it too much for now. We will be interested to see how the ECB revises its compensation per employee forecasts in tomorrow’s updated forecast round.
• Eurostat estimates that wages and salaries growth was 3.0% Y/Y (vs 3.8% prior), and non-salary related labour cost growth was 4.0% Y/Y (vs 4.3% prior).
• Labour costs eased in Germany, Spain and Italy, and ticked up a tenth in France.