[MARKET ANALYSIS] G10s stabilise after post-FOMC USD bid, GBP to digest BoE and by-election; SNB and Norges Bank broadly as expected

G10s are mixed with Kiwi the best performer vs. the Buck after strong GDP data, and CHF the underperformer after its policy announcement implied concerns with low inflation.
USD takes a breather after hefty gains in wake of the hawkish FOMC meeting. In short, it was a hawkish Fed statement and press conference with both putting significant emphasis on returning inflation to target, and dots showing nine members project a hike before year-end. (See US Market wrap for more)
GBP is stabilising after hefty losses against the Buck post-FOMC, with key risk events ahead. The BoE announcement is due today, where the MPC is widely expected to keep rates on hold in a 7-2/8-1 vote split as recent data and energy moderation support the narrative that bank rate is restrictive. With markets assigning a 95% probability of no-change today, attention will be on the vote split. While consensus is for 7-2/8-1, hawkish dissent from Chief Economist Pill and potentially one or two more policymakers remains possible, and would likely spur a hawkish reaction. In addition to the BoE, GBP will also digest results of the Makerfield by-election which will likely see Labour candidate Burnham emerge as the winner, and challenge incumbent Starmer.
UK Jobs report was stronger than expected, the unemployment rate came below consensus and dipped from the prior, while payroll numbers and vacancies continued to fall in April. Although the report does not change the fact that the BoE will stand pat on rates in June, the sticky wage figures and improvement in the unemployment level, despite some of the under-the-bonnet indicators and observations on both, may be used as part of the explanatory text from any hawkish dissenter.
Norges Bank was broadly as expected with a fleeting kneejerk lower in NOK, the unwinding of tightening bets by c. 15% of market participants. The 2026 core CPI view was maintained and the 2027 one was trimmed modestly, as expected, while forecasts and commentary still show that inflation is “too high” and the Governor outlined that new information shows “inflation pressures are slightly stronger than we had anticipated earlier”. As such, the Norges Bank points to tightening ahead, roughly in line with market expectations. EUR/NOK +0.3%.
SNB kept rates unchanged in a mostly as-expected meeting. EUR/CHF is firmer today, potentially surrounding the fact that commentary around energy/raw materials suggests that the new forecasts do not account for the moderation in energy seen recently; over the medium term, sparking a return to concerns around inflation being too low in Switzerland. As such, EUR/CHF -0.2%.