Euro May Ignore German CPI as ECB Rate Decision Looms Large
DailyFX.com -
Talking Points:
Euro May Overlook German CPI Data as ECB Rate Decision Looms Large
IMF Decision to Include Chinese Yuan into SDR to Pass with Little Fanfare
New Zealand Dollar Gains Alongside Yields on Improving RBNZ Outlook
German CPI figures headline the economic data docket in European trading hours. The benchmark year-on-year inflation rate is expected to tick narrowly higher to 0.4 percent in November from 0.3 percent in the prior month. The outcome seems unlikely to trigger a significant response from the Euro, with traders probably unwilling to commit to a firm directional bias ahead of the much-anticipated ECB policy announcement due later in the week.
The markets are likewise waiting for confirmation that the IMF has decided to include the Chinese Yuan into its SDR basket of reserve currencies. Christine Lagarde, the Fund’s Managing Director, issued a statement supporting staff recommendation to proceed with the move last week. As we’ve discussed in detail elsewhere, the announcement is unlikely to translate into a lasting, meaningful response from the financial markets in the near term.
The New Zealand Dollar outperformed in otherwise quiet overnight trade. The currency’s advance tracked an upward push in front-end bond yields, hinting at an improvement in prevailing RBNZ monetary policy expectations as the driving catalyst. Indeed, while investors continue to price in at least one rate cut over the coming 12 months, the probability of a 25bps reduction at next month’s meeting dropped to 48 percent from 56 percent at the close of trade last week.
Losing Money Trading Forex? This Might Be Why.
Asia Session
GMT | CCY | EVENT | ACT | EXP | PREV |
21:45 | NZD | Building Permits (MoM) (OCT) | 5.1% | - | -5.8% |
23:30 | AUD | TD Securities Inflation (MoM) (NOV) | 0.1% | - | 0.0% |
23:30 | AUD | TD Securities Inflation (YoY) (NOV) | 1.8% | - | 1.8% |
23:50 | JPY | Industrial Production (MoM) (OCT P) | 1.4% | 1.8% | 1.1% |
23:50 | JPY | Industrial Production (YoY) (OCT P) | -1.4% | -0.9% | -0.8% |
23:50 | JPY | Retail Trade (YoY) (OCT) | 1.8% | 0.9% | -0.1% |
23:50 | JPY | Retail Sales (MoM) (OCT) | 1.1% | 0.3% | 0.8% |
23:50 | JPY | Dept. Store, Supermarket Sales (OCT) | 2.9% | 3.0% | 1.7% |
00:00 | NZD | ANZ Activity Outlook (NOV) | 32.0 | - | 23.7 |
00:00 | NZD | ANZ Business Confidence (NOV) | 14.6 | - | 10.5 |
00:30 | AUD | Company Operating Profit (QoQ) (3Q) | 1.3% | 1.0% | -0.5% |
00:30 | AUD | Inventories SA (QoQ) (3Q) | 0.1% | 0.0% | 0.2% |
00:30 | AUD | Private Sector Credit (MoM) (OCT) | 0.7% | 0.6% | 0.7% |
00:30 | AUD | Private Sector Credit (YoY) (OCT) | 6.7% | 6.6% | 6.6% |
01:00 | JPY | BOJ’s Kuroda Speaks in Nagoya | - | - | - |
02:00 | NZD | Money Supply M3 (YoY) (OCT) | 7.7% | - | 8.5% |
04:00 | JPY | Vehicle Production (YoY) (OCT) | -0.5% | - | -2.6% |
05:00 | JPY | Housing Starts (YoY) (OCT) | -2.5% | 2.6% | 2.6% |
05:00 | JPY | Annualized Housing Starts (OCT) | 0.862M | 0.908M | 0.900M |
05:00 | JPY | Construction Orders (YoY) (OCT) | -25.2% | - | 6.7% |
European Session
GMT | CCY | EVENT | EXP | PREV | IMPACT |
07:00 | EUR | German Retail Sales (MoM) (OCT) | 0.4% | 0.0% | Medium |
07:00 | EUR | German Retail Sales (YoY) (OCT) | 2.9% | 3.4% | Medium |
08:00 | CHF | KOF Leading Indicator (NOV) | 100.2 | 99.8 | Low |
08:00 | CHF | Total Sight Deposits (NOV 27) | - | 468.3B | Low |
08:00 | CHF | Domestic Sight Deposits (NOV 27) | - | 402.7B | Low |
09:30 | GBP | Net Consumer Credit (OCT) | 1.3B | 1.3B | Low |
09:30 | GBP | Net Lending Sec. on Dwellings (OCT) | 3.4B | 3.6B | Low |
09:30 | GBP | Mortgage Approvals (OCT) | 69.9K | 68.9K | Medium |
09:30 | GBP | M4 Money Supply (MoM) (OCT) | - | -1.0% | Low |
09:30 | GBP | M4 Money Supply (YoY) (OCT) | - | -0.6% | Low |
09:30 | GBP | M4 Ex IOFCs 3M Annualised (OCT) | 3.0% | 4.0% | Low |
09:30 | GBP | Lloyds Business Barometer (NOV) | - | 50.0 | Low |
13:00 | EUR | German CPI (MoM) (NOV P) | 0.1% | 0.0% | High |
13:00 | EUR | German CPI (YoY) (NOV P) | 0.4% | 0.3% | High |
13:00 | EUR | German CPI - EU Harmonized (MoM) (NOV P) | 0.1% | 0.0% | Low |
13:00 | EUR | German CPI - EU Harmonized (YoY) (NOV P) | 0.3% | 0.2% | Low |
Critical Levels
CCY | Supp 3 | Supp 2 | Supp 1 | Pivot Point | Res 1 | Res 2 | Res 3 |
EURUSD | 1.0462 | 1.0531 | 1.0562 | 1.0600 | 1.0631 | 1.0669 | 1.0738 |
GBPUSD | 1.4901 | 1.4980 | 1.5008 | 1.5059 | 1.5087 | 1.5138 | 1.5217 |
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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