EUR/USD Fundamental Analysis November 3, 2014 Forecast

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Updated: Aug 25, 2015, 07:00 UTC

Analysis and Recommendations: The EUR/USD tumbled by 38 points to trade at 1.2574 after German retails sales printed well below forecast and the US dollar

EUR/USD Fundamental Analysis November 3, 2014 Forecast

Analysis and Recommendations:

The EUR/USD tumbled by 38 points to trade at 1.2574 after German retails sales printed well below forecast and the US dollar continued to gain. U.S. gross domestic product grew at a 3.5 percent annualized rate in the three months ended September after a 4.6 percent gain in the second quarter, Commerce Department figures showed yesterday in Washington. It marked the strongest back-to-back readings since the last six months of 2003.

Sales generated by German retailers experienced the biggest drop in September in over seven years, the National Statistics Office (Destatis) reported Friday. Revenue decreased by 2.9 percent month-on-month, after rising by 1.5 percent in August. In real terms – that is adjusted for price fluctuations – there was an even deeper fall of 3.2 percent in the month under review. The sale of textiles, shoes and leatherwear appeared particularly sluggish in September, easing by 5.7 percent month-on-month. By contrast, the statistics office logged an 8.2-percent increase in turnover from pharmaceutical and medical products.

The plunge in German retail sales, the biggest drop since May 2007, indicates that the German economy was very close to a technical recession in Q2 and Q3. Retail sales were on track for a decent quarterly expansion before September data, but today’s data are bad enough to indicate that retail sales fell back to a modest contraction in Q3.

Euro-area inflation accelerated from a five-year low in October, offering some reprieve to European Central Bank policy makers struggling to prevent a spiral of price declines.

Consumer prices rose 0.4 percent from a year earlier, the European Union’s statistics office in Luxembourg said today. That’s in line with the median of 41 estimates in a Bloomberg News survey and follows a reading of 0.3 percent in September.

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 actual vs. forecast:

Cur.	Event	Actual	Forecast	Previous
JPY	Household Spending	1.5%	1.9%	-0.3%
JPY	National Core CPI (Sep)	3.0%	3.0%	3.1%
JPY	Tokyo Core CPI (Oct)	2.5%	2.5%	2.6%
AUD	PPI (QoQ) (Q3)	0.2%	0.2%	-0.1%
EUR	German Retail Sales	-3.2%	-1.0%	1.5%
JPY	BoJ Press Conference
EUR	French Consumer	-0.8%	-0.3%	0.9%
EUR	Italian CPI (MoM)	0.1%	-0.2%	-0.4%
EUR	CPI (YoY) (Oct)	0.4%	0.4%	0.3%
EUR	Unemployment Rate	11.5%	11.5%	11.5%
USD	Core PCE Price Index		0.1%	0.1%
CAD	GDP (MoM) (Aug)		0.0%	0.0%
USD	Chicago PMI (Oct)		60.0	60.5
USD	UM Consumer Sent		86.4	86.4

Upcoming Economic Events that you should be monitoring:

Cur.	Event	Actual	Forecast	Previous
AUD	AIG Manufacturing			46.5
AUD	Building Approvals			3.0%
CNY	Non-Manufacturing PMI			54.0
CNY	HSBC Mfg. PMI			50.4
EUR	Spanish Manufacturing			52.6
EUR	Italian Manufacturing		50.7	50.7
EUR	French Manufacturing		47.3	47.3
EUR	German Manufacturing		51.8	51.8
EUR	Manufacturing PMI		50.7	50.7
GBP	Manufacturing PMI			51.6
USD	ISM Employment		55.0	54.6
USD	ISM Manufacturing PMI		56.7	56.6