Economic Data from China and the U.S in Focus Following Inflation Figures from New Zealand

Earlier in the Day:

It was a relatively quiet start to the day on the economic calendar this morning. The Kiwi Dollar was in action this morning.

Later this morning, economic data from China will be key. Stats include 3^rd quarter GDP, industrial production, fixed asset investment, and retail sales figures for September.

Expect the industrial production and 3^rd quarter GDP numbers to have the greatest impact on riskier assets.

For the Kiwi Dollar

In the 3^rd quarter, consumer prices rose by 2.2%, quarter-on-quarter, versus a forecasted 1.4%. Consumer prices had risen by 1.3% in the previous quarter.

The annual rate of inflation accelerated from 3.3% to 4.9%. Economists had forecast an annual rate of inflation of 4.1% for the 3^rd quarter.

According to NZ Stats,

• Excluding quarters impacted by increases in GST rates, the quarterly rise was the highest since the June 1987 quarter.
• Prices rose across 10 of the 11 main groups in the CPI basket in the quarter.
• The main drivers were housing-related costs, such as construction of new houses and local authority rates.
• Prices for construction of new houses were up 4.5% for the quarter and 12% for the year.
• Both supply-chain challenges and high demand pushed up the cost of building houses.
• Local authority rates and payments rose 7.1% in the quarter.
• Vegetable prices jumped by 19%, with transport prices up 4.2%.
• Petrol prices rose by 6.5% in the quarter and by 22% for the year.
• Bucking the trend was a 2.7% fall in prices for new cars.

The Kiwi Dollar moved from $0.70721 to $0.70830 upon release of the figures. At the time of writing, the Kiwi Dollar was up by 0.22% to $0.70870.

Elsewhere

At the time of writing, the Japanese Yen was down by 0.02% to ¥114.240 against the U.S Dollar. The Aussie Dollar was flat at $0.7421.

The Day Ahead

For the EUR

It’s a particularly quiet day ahead on the economic calendar. There are no material stats to provide the EUR with direction.

The lack of stats will leave the EUR in the hands of market risk sentiment on the day.

At the time of writing, the EUR was flat at $1.1601.

For the Pound

It’s also a particularly quiet day ahead on the economic calendar, with no major stats due out of the UK to provide the Pound with direction.

The lack of stats will leave the Pound in the hands of market sentiment towards BoE monetary policy and market risk sentiment.

At the time of writing, the Pound was up by 0.03% to $1.3755.

Across the Pond

It’s a relatively quiet day ahead. Industrial production figures for September are due out later in the day.

With little else for the markets to consider, we can expect the numbers to draw interest.

Any FOMC member chatter will likely have a greater impact on the day, however.

On Friday, the U.S Dollar Spot Index fell by 0.02% to 93.937.

For the Loonie

It’s a relatively quiet day ahead for the Loonie. Foreign securities purchases for August and housing starts for September are due out later in the day.

We don’t expect the numbers to influence, however.

From the Bank of Canada, the Business Outlook Survey, due out later in the day, will provide the Loonie with direction.

Away from the economic calendar, crude oil prices and market risk sentiment will also provide direction.

At the time of writing, the Loonie was up by 0.02% to C$1.2366 against the U.S Dollar.

For a look at all of today’s economic events, check out our economic calendar.