GDP and Consumer Confidence Numbers Put the EUR and Dollar in Focus

Earlier in the Day:

The economic calendar was on the quiet side through the Asian session this morning. There were no material stats released during the Asian session.

Outside of the numbers, the Asian market reacted further to U.S President Trump’s change in strategy on trade. After Friday’s escalation, Trump stated on Monday that U.S and China trade negotiations were set to go ahead.

The comments came in spite of Trump previously stating that he was not interested in a trade agreement with China. Market volatility and concerns over the U.S and global economy likely put pressure on the U.S President to return to the negotiating table.

Monday’s moves that saw the Yen jump to ¥104 levels against the Greenback before closing at the day in the red, at ¥106.12, reflected just how sensitive the markets have become to trade war chatter.

The Majors

At the time of writing, the Japanese Yen was up by 0.10% to ¥106.01 against the U.S Dollar, while the Aussie Dollar was down by 0.03% to $0.6773. The Kiwi Dollar was down by 0.06% to $0.6390.

The Day Ahead:

For the EUR

It’s a relatively busy day ahead on the economic calendar. Key stats due out of the Eurozone include 2^nd estimate GDP numbers out of German and jobseeker numbers out of France.

Barring any revisions to Germany’s 2^nd quarter GDP numbers, we would expect the stats to have a relatively muted impact on the EUR.

In spite of concerns of a European recession, the EUR continues to hover at around the $1.11 level. Expectations are that both the FED and ECB will cut rates next month. It will ultimately boil down to policy divergence. From the last ECB minutes, it wasn’t clear how far the ECB was willing to go to shore up the economy.

Outside of the stats, it goes without saying that any chatter on trade will need consideration. There is also the Tuesday deadline for political parties in Italy to form a government to factor in.

At the time of writing, the EUR was down by 0.01% to $1.1101.

For the Pound

It’s a quiet day ahead on the data front. Following Monday’s public holiday, economic data is limited to mortgage approvals that will likely be brushed aside.

The lack of stats will continue to leave the Pound in the hands of Brexit chatter. Talk of shutting down Parliament will continue to do the rounds, while there will also be the hope of a last-minute deal.

Hope has become a commodity of late in the global financial markets and has propped up the Pound.

At the time of writing, the Pound up by 0.02% to $1.2219.

Across the Pond

It’s a relatively quiet day on the economic calendar. Key stats include June house price figures and August consumer confidence numbers.

The markets will focus on the CB Consumer Confidence figures. With the U.S manufacturing sector in contraction, consumer spending remains a key contributor to the U.S economy. A marked deterioration in confidence would be another red flag for the FED to consider.

Outside of the numbers, chatter from the Oval Office will also provide direction on the day.

At the time of writing, the Dollar Spot Index was down by 0.06% to 98.024.

For the Loonie

It’s a day ahead on the economic calendar. There are no material stats due out of Canada.

Market risk sentiment will influence on the day.

The Loonie was up by 0.04% at C$1.3249, against the U.S Dollar, at the time of writing.