Analysis and Recommendations: The EUR/USD fell 20 points to trade at 1.0573 after German retail sales plummeted and traders prepare for a massive stimulus
The EUR/USD fell 20 points to trade at 1.0573 after German retail sales plummeted and traders prepare for a massive stimulus program from the ECB later this week. The U.S. payrolls report on Friday should cement expectations that the Fed will move. Net bets on dollar appreciation rose to their highest in eight months in the week to last Tuesday. They are still only around 60 to 70 percent of highs hit in March and April. The main focus for markets this week will be a series of central bank meetings, chiefly the ECB’s on Thursday, when it is widely expected to cut interest rates on euro deposits and extend its quantitative easing program.
By contrast, the Federal Reserve is expected to raise U.S. rates for the first time in almost a decade later in December. The U.S. central bank has held the federal funds rate near zero since the aftermath of the global financial crisis. It managed to wrongfoot some investors back in September with its decision not to lift interest rates because of weakening global growth. It noted a recent surge in market volatility – notably from China – and sparked claims from some economists that it had created a “third mandate.”
The dollar reached an 8 1/2-month high against a basket of currencies on Monday, as the prospect of further stimulus this week from the European Central Bank drove the euro to its lowest since April.
Before the expected announcement of its joining the IMF’s basket of reserve currencies, China’s yuan gained around 0.4 percent offshore amid talk of intervention by Beijing to tighten the spread between on- and offshore rates.
The main focus for markets this week will be a series of central bank meetings, chiefly the ECB’s on Thursday, when it is widely expected to cut interest rates on euro deposits and extend its quantitative easing program.
FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.
Today’s economic releases:
Cur. |
Event |
Actual |
Forecast |
Previous |
|||
NZD |
ANZ Business Confidence (Nov) |
14.6 |
15.0 |
10.5 |
|
||
AUD |
Company Gross Operating Profits |
1.3% |
1.0% |
-0.5% |
|||
AUD |
Private Sector Credit (MoM) (Oct) |
0.7% |
0.6% |
0.8% |
|
||
JPY |
BoJ Governor Kuroda Speaks |
|
|
|
|
||
EUR |
German Retail Sales (MoM) (Oct) |
-0.4% |
0.4% |
0.0% |
|
||
EUR |
German CPI (MoM) (Nov) |
|
0.1% |
0.0% |
Upcoming Economic Events that you should be monitoring:
Tuesday, December 1, 2015
Cur. |
Event |
Actual |
Forecast |
Previous |
|||
AUD |
AIG Manufacturing Index (Nov) |
|
|
50.2 |
|
||
JPY |
Capital Spending (YoY) (Q3) |
|
|
5.6% |
|
||
AUD |
Building Approvals (MoM) (Oct) |
|
-2.3% |
2.2% |
|
||
AUD |
Current Account (Q3) |
|
-16.5B |
-19.0B |
|
||
CNY |
Manufacturing PMI (Nov) |
|
49.8 |
49.8 |
|
||
CNY |
Non-Manufacturing PMI (Nov) |
|
|
53.1 |
|
||
CNY |
Caixin Manufacturing PMI (Nov) |
|
48.3 |
48.3 |
|
||
AUD |
Interest Rate Decision (Dec) |
|
2.00% |
2.00% |
|
||
EUR |
German Manufacturing PMI (Nov) |
|
52.6 |
52.6 |
|
||
EUR |
German Unemployment Change |
|
-5K |
-5K |
|
||
EUR |
German Unemployment Rate (Nov) |
|
6.4% |
6.4% |
|
||
EUR |
Manufacturing PMI (Nov) |
|
52.8 |
52.8 |
|
||
GBP |
Manufacturing PMI (Nov) |
|
54.0 |
55.5 |
|
||
EUR |
Unemployment Rate (Oct) |
|
10.8% |
10.8% |
|
||
USD |
Manufacturing PMI (Nov) |
|
|
52.6 |
|
||
USD |
ISM Manufacturing Employment |
|
48.5 |
47.6 |
|
||
USD |
ISM Manufacturing PMI (Nov) |
|
50.4 |
50.1 |
|
Government Bond Auctions
Date Time Country
Dec 02 11:30 UK Gbp 3.75bn 1.5% Jan 2021 Gilt
Dec 02 16:30 Sweden Announces details of Bond on 11 Dec
Dec 03 10:30 Spain 1.15% Jul 2020 Bono
Dec 03 10:50 France
Dec 03 11:03 Sweden Sek 0.7bn 1%
Dec 07 13:00 Norway Details bond auction on 09 Dec
Dec 07 17:30 Italy Announces details of BTP/CCTeu on 11 Dec
Dec 08 11:30 UK 3.5% 2045 Gilt auction
Dec 08 19:00 US Holds 3-year note auction
Dec 09 11:03 Sweden Holds bond auction
Dec 09 11:05 Norway Holds bond auction
Dec 09 11:30 Germany Eur 3bn Dec 2017 Schatz
Dec 09 19:00 US Holds 10-year note auction
Dec 10 19:00 US Holds 30-year bond auction
Dec 11 11:10 Italy Auctions BTPs/CCTeus