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Bob Mason
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Background of different currencies

Earlier in the Day

It’s was a busy start to the week on the economic calendar this morning. The Kiwi Dollar, the Aussie Dollar, and the Japanese Yen were in action early on, with economic data from China also in focus.

For the Kiwi Dollar

Building consents surged by 8.8% in October to hit a 46-year high, following a 3.6% jump in September.

According to NZ Stats,

  • Compared with October 2019, the number of new homes consented increased by 2.8%.
  • Annual new homes consented reached 37,981, to sit just short of 1974’s all-time high 40,025.
  • Strong growth plans to build townhouses, flats, and units drove consents higher.

The Kiwi Dollar moved from $0.70678 to $0.70663 upon release of the figures. At the time of writing, the Kiwi Dollar was down by 0.10% to $0.7061.

For the Aussie Dollar

Trade data was in focus this morning.

In October, the trade surplus widened from A$5.630bn to A$7.456bn. Economists had forecasted a widening to A$5.800bn.

According to the ABS,

  • Exports of goods and services rose A$1,819m (5%) to A$35,720m
    • There were increases in the net exports of general merchandise (8%), rural goods (8%), and non-rural goods 8%).
    • The net exports of goods under merchanting rose by 100% but only accounted for A$18m of the total increase in exports.
  • Imports of goods and services saw a modest A$178m (1%) increase to A$28,264m.
    • Non-monetary gold imports fell A$232m (33%).
    • Imports of intermediate and other merchandise goods, capital goods, consumption goods, and general merchandise debits each rose by 2%.

The Aussie Dollar moved from $0.74076 to $0.74036 upon release of the figures that preceded service sector PMI numbers from China. At the time of writing, the Aussie Dollar was down by 0.16% to $0.74026.

For the Japanese Yen

Finalized service sector PMI numbers were in focus this morning. The Markit Services PMI came in at 47.8 for November, which was up from an October 47.7.

According to the finalized November Survey,

  • Incoming new business fell at a faster rate, while output saw a softer decline in November.
  • Firms reduced workforce numbers in the month.
    While optimism softened, the level of optimism towards the next 12-months remained elevated.

The Japanese Yen moved from ¥104.502 to ¥104.479 upon release of the figures. At the time of writing, the Japanese Yen was down by 0.11% to ¥104.53 against the U.S Dollar.

From China

The Caixin Services PMI rose from 56.8 to 57.8 in November. Economists had forecast a decline to 56.5.

According to the November survey,

  • Greater customer demand and sustained recovery of market conditions supported the upside.
  • Total new business rose at the fastest pace since April 2010, with business confidence hitting the highest level in over nine-and-a-half years.
  • Employment rose at the fastest pace in over a decade.
  • There was a sharp increase in operating expenses, however.

The Aussie Dollar moved from $0.74013 to $0.74048 upon release of the figures.

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The Day Ahead

For the EUR

It’s a busy day ahead on the economic calendar. Spanish and Italian service sector PMI numbers are due out along with Eurozone retail sales figures for October. Finalized services and composite PMI figures are also due out of France, Germany, and the Eurozone.

Barring any marked revisions to prelim figures, we would expect Italy and the Eurozone’s PMIs to garner the greatest interest.

Away from the economic calendar, Brexit updates will also provide direction.

At the time of writing, the EUR was down by 0.02% to $1.2113.

For the Pound

It’s a relatively quiet day ahead on the economic calendar. Finalized services and composite PMI figures are due out later today.

Barring material revisions to prelim figures the stats are unlikely to have a material impact on the Pound.

Expect Brexit updates to be the key driver on the day.

At the time of writing, the Pound was up by 0.01% to $1.3366.

Across the Pond

It’s a relatively busy day ahead for the U.S Dollar. November’s ISM Non-Manufacturing PMI and weekly jobless claims figures will have the greatest influence on market risk sentiment.

Markit services and composite PMI numbers will likely have a muted impact on the day.

Away from the economic calendar, any chatter from Capitol Hill and COVID-19 news updates will continue to influence.

At the time of writing, the Dollar Spot Index was down by 0.08% to 91.041.

For the Loonie

It’s a particularly quiet day on the economic data front. There are no material stats due out to provide the Loonie with direction.

The lack of stats will leave the Loonie in the hands of crude oil inventories and market risk sentiment.

At the time of writing, the Loonie was down by 0.02% to C$1.2920 against the U.S Dollar.

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

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