EUR/USD Fundamental Analysis – November 5, 2015 – Forecast

Barry Norman

EUR/USD Fundamental Analysis – November 5, 2015 - Forecast
Analysis and Recommendations:

The EUR/USD continued to ease after comments from Mario Draghi once again shifted markets back to December stimulus. The euro is down 41 points to 1.0923 as the US dollar continued its three day rally. Speaking at a cultural event in Frankfurt, Draghi repeated that the ECB would review the degree of monetary stimulus required at the next governing council meeting in December, but is “willing and able to use all the instruments available”.

Growth prospects in emerging markets and “external factors” are dragging on the outlook for growth and inflation, he said. Domestic demand remains “resilient”, however.

Last month, Draghi said the ECB would be better able to decide the level of stimulus needed once the latest inflation forecasts for the Eurozone came in.

The euro declined against the dollar for a second day as the prospect of further monetary easing in Europe contrasted with speculation the Federal Reserve will increase interest rates at its December meeting.

The single currency weakened against 14 of its 16 major peers after European Central Bank President Mario Draghi reiterated on Tuesday the ECB will consider increasing stimulus at its December meeting. He said the central bank was “willing and able to act by using all the instruments available within its mandate if warranted in order to maintain an appropriate degree of monetary accommodation.”

Investors will now turn their attention to Fed Chair Janet Yellen who is scheduled to address the U.S. Congress on Wednesday. This will be her first speech since she said last month that the central bank could still raise rates at its Dec. 15-16 meeting.

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

 

  USD

 

API Weekly Crude Oil Stock

2.800M

 

4.100M

 

 

  NZD

 

Employment Change (QoQ) (Q3)

-0.4%

0.4%

0.1%

   

  NZD

 

Unemployment Rate (Q3)

6.0%

6.0%

5.9%

 

 

  AUD

 

Retail Sales (MoM) (Sep)

0.4%

0.4%

0.4%

 

 

  AUD

 

Trade Balance (Sep)

-2.317B

-3.000B

-2.711B

   

  CNY

 

Caixin Services PMI (Oct)

52.0

50.8

50.5

 

 

  EUR

 

German Services PMI (Oct)

54.5

55.2

55.2

 

 

  EUR

 

ECB President Draghi Speaks  

 

 

 

 

 

  EUR

 

Markit Composite PMI (Oct)

53.9

54.0

54.0

 

 

  EUR

 

Services PMI (Oct)

54.1

54.2

54.2

 

 

  GBP

 

Services PMI (Oct)

54.9

54.5

53.3

 

 

  USD

 

FOMC Member Brainard Speaks 

 

 

 

 

 

  USD

 

ADP Nonfarm Employment (Oct)

 

180K

200K

   

 

Upcoming Economic Events that you should be monitoring:

Wednesday, November 4, 2015

Cur.

 

Event

Actual

Forecast

Previous

 

  AUD

 

RBA Governor Stevens Speaks  

 

 

 

 

 

  JPY

 

Monetary Policy Meeting Minutes

 

 

 

 

 

  USD

 

FOMC Member Stanley Fischer 

 

 

 

 

 

  EUR

 

German Factory Orders (MoM) (Sep)

 

1.0%

-1.8%

 

 

  EUR

 

ECB Economic Bulletin  

 

 

 

 

 

  EUR

 

Retail Sales (MoM) (Sep)

 

0.2%

0.0%

 

 

  EUR

 

ECB President Draghi Speaks  

 

 

 

 

 

  GBP

 

Interest Rate Decision (Nov)

 

0.50%

0.50%

 

 

  GBP

 

BoE MPC Meeting Minutes

 

 

 

 

 

  GBP

 

BoE Gov Carney Speaks  

 

 

 

 

 

  USD

 

FOMC Member Dudley Speaks  

 

 

 

 

 

  USD

 

Initial Jobless Claims

 

262K

260K

 

 

  USD

 

Unit Labor Costs (QoQ) (Q3)  

 

2.3%

-1.4%

 

 

  USD

 

FOMC Member Stanley Fischer 

 

 

 

 

 

  USD

 

FOMC Member Lockhart Speaks 

 

 

 

   

Government Bond Auctions

Date Time Country

Nov 03 10:10 Austria Holds RAGB bond sale

Nov 04 15:30 Sweden Announces details of Bond on 11 Nov

Nov 04 N/A Holland Announces details of Bond on 10 Nov

Nov 05 09:30 Spain Auctions Bonos

Nov 05 09:50 France Auctions OATs

Nov 05 10:03 Sweden Holds I/L bond auction

Nov 09 12:00 Norway Details bond auction on 11 Nov

Nov 09 15:30 Italy Announces details of BTPs/CCTeu on 12 Nov

Nov 09 N/A US Holds 3-year note auction

Nov 10 10:30 UK 0.125% 2058 I/L Gilt auction

Nov 10 N/A Holland Eur 2.0-3.0bn 0% Apr 2018 DSL

Nov 10 N/A US Holds 10-year note auction

Nov 11 10:03 Sweden Holds bond auction

Nov 11 11:15 Norway Holds bond auction

Nov 11 10:30 Germany Eur 3bn 0.25% Oct 2020 Bobl

Nov 12 10:10 Italy Auctions BTPs/CCTeus

Nov 12 10:30 UK 4.25% 2039 Gilt auction

Nov 12 N/A US Holds 30-year bond auction

 

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