Inflation Puts the EUR, the Pound, and the Loonie in Focus

Earlier in the Day:

It was a busier start to the day on the economic calendar this morning. The Kiwi Dollar, the Japanese Yen, and the Aussie Dollar were in action early this morning.

For the Kiwi Dollar

Wholesale inflation was in focus.

In the 3^rd quarter, the producer input price index rose by 1.6%, quarter-on-quarter. The index had risen by 3.0% in the previous quarter.

According to NZ Stats,

• The overall change in prices paid by producers was influenced by increases in the dairy product manufacturing industry (+7.4%) as raw-milk prices increased.
• Producer prices increased more in the year ended Sep-2021 than in any other year for more than a decade.

The Kiwi Dollar moved from $0.69888 to $0.69904 upon release of the figures. At the time of writing, the Kiwi Dollar was down by 0.07% to $0.6987.

For the Japanese Yen

Japan’s trade deficit narrowed from ¥624.1bn to ¥67.4bn in October. Economists had forecast a narrowing to ¥310.0bn.

According to figures released by the  Ministry of Finance,

• Exports were up 9.4%, year-on-year, after having been up 13% in September.
• To China, exports were up 9.5%, with exports to Germany and the UK rising by 15.0% and by 7.4% respectively.
• Exports to the U.S increased by just 0.4%, however, with exports to Australia sliding by 18.4%.
• Imports increased by 26.7%, year-on-year, after having been up 38.6% in September.
• From the U.S, imports increased by 18.5%, with imports from China rising by 11.4%.
• Imports from Australia surged by 90.5%, with imports from Western Europe up 15.3%.

The Japanese Yen moved from ¥114.917 to ¥114.906 upon release of the figures. At the time of writing, the Japanese Yen was down by 0.04 ¥114.870 against the U.S Dollar.

For the Aussie Dollar

Wage growth drew plenty of interest this morning.

In the 3^rd quarter, wages grew by 0.6% quarter-on-quarter versus a forecasted 0.5% increase. Wages had grown by 0.4% in the previous quarter. Year-on-year, wages grew by 2.2%.

According to the ABS,

• Private sector wages rose by 2.4% annually, while growth in the public sector continued to track below the private sector.
• The annual growth rate returned to a more regular September quarter pattern of wage growth, following the labor market disruptions through 2020 and 2021.

The Aussie Dollar moved from $0.72999 to $0.72848 upon release of the figures. At the time of writing, the Aussie Dollar was down by 0.26% to $0.7284.

The Day Ahead

For the EUR

It’s a relatively quiet day ahead on the economic calendar. Finalized October inflation figures for the Eurozone will be in focus later today.

Following ECB President Lagarde’s comments from earlier in the week, the impact of any revisions on the EUR may be limited, however.

From the ECB, the ECB’s Financial Stability Review will provide direction, however.

At the time of writing, the EUR was down by 0.02% to $1.1318.

For the Pound

It’s another busy day ahead on the economic calendar.

Inflation figures for October will be in focus.

Expect plenty of influence from the numbers. While the BoE disappointed last time around, a further pickup in inflationary pressure may force a move…

At the time of writing, the Pound was down by 0.05% to $1.3423.

Across the Pond

It’s a quieter day ahead on the economic calendar.

Economic data is limited to housing sector numbers for October. We don’t expect the numbers to have any impact on the Greenback or market risk sentiment.

Expect any FOMC member chatter to provide direction, however. FOMC members Williams, Bowman, and Mester are scheduled to speak

On Tuesday, the U.S Dollar Spot Index rose by 0.53% to end the day at 95.915.

For the Loonie

It’s a busier day ahead, with October inflation figures in focus.

Expect plenty of Loonie sensitivity to the numbers, with crude oil inventories to also provide direction.

At the time of writing, the Loonie was down by 0.09% to C$1.2569 against the U.S Dollar.

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