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Europe Roundup: Euro dips as greenback firms as U.S. inflation poses next test, Gold eases, Oil gains after U.S. infrastructure bill passes-November 8th,2021

Market Roundup

• Swiss Oct Unemployment Rate s.a. 2.7% ,2.7% forecast, 2.8% previous

• Swiss Oct Unemployment Rate n.s.a 2.5% ,2.6% forecast, 2.6% previous

•Finnish Sep Trade Balance  0.10B,-0.59B previous

•French Oct  Reserve Assets Total  216,645.0M, 213,268.0M previous

•EU Nov Sentix Investor Confidence 18.3, 15.5 forecast, 16.9      previous

Looking Ahead Economic Data (GMT)

•14:00 French 12-Month BTF Auction  -0.651% previous

•14:00 French 3-Month BTF Auction -0.772% previous

•14:00 French 6-Month BTF Auction -0.684% previous

•15:00 US Oct CB Employment Trends Index  110.35 previous

Looking Ahead - Events, Other Releases (GMT)

•14:00 US FOMC Member Clarida Speaks

•14:00 ECB's Lane Speaks

•15:30 US Fed Chair Powell Speaks

•15:55 US FOMC Member Williams Speaks

•17:00 UK BoE Gov Bailey Speaks

•17:00  US FOMC Member Bowman Speaks

•18:00 German Buba Balz Speaks


EUR/USD: The euro edged lower against dollar on Monday as investors scaled back expectations for aggressive interest rate hikes from major central banks in the face of growing inflationary risks. European Central Bank chief economist Philip Lane told a Spanish newspaper that euro zone inflation will ease next year, becoming the latest ECB official to push back against market rate-hike bets. The dollar rose slightly on the euro to $1.1558, though remained below the 15-month top of $1.15135 made in the wake of strong U.S. labour data on Friday. Immediate resistance can be seen at 1.1576 (5DMA), an upside break can trigger rise towards 1.1594 (38.2%fib).On the downside, immediate support is seen at 1.1526 (23.6 % fib), a break below could take the pair towards 1.1502 (Lower BB).

GBP/USD: Sterling recovered some ground on Monday as investors continued to digest the fallout of several big central bank decisions made across the US and UK last week. On Thursday, the Bank of England decided to hold base UK interest rates at a historic low of 0.1%, a move that knocked both markets and the pound. The US Federal Reserve also moved to taper its bond buying programme  an action that had been heavily signalled.UK investors will also be watching the first readings of third quarter GDP data for the UK for signs of strength in the COVID-19 recovery.  Immediate resistance can be seen at 1.3508 (38.2%fib), an upside break can trigger rise towards 1.3569 (50%fib).On the downside, immediate support is seen at 1.3430(23.6%fib), a break below could take the pair towards 1.3400(Psychological level).

USD/CHF: The dollar strengthened against the Swiss franc on Monday as currency traders seek a path between markets' volatile rate projections and central bankers vowing a wait-and-see approach despite surging inflation. The next big test of faith in the Federal Reserve's insistence on patience looms on Wednesday, when U.S. inflation data is expected to show consumer growth running hot. At (GMT 11:03), greenback gained 0.38% versus the Swiss franc to 0.9155.Immediate resistance can be seen at 0.9156 (38.2%fib), an upside break can trigger rise towards 0.9184 (50%fib).On the downside, immediate support is seen at 0.9114 (23.6%fib), a break below could take the pair towards 0.9076 (Lower BB).

USD/JPY: The dollar edged higher against the Japanese yen on Monday as last week’s upbeat U.S. October jobs report supported dollar. Better-than-expected U.S. payrolls report that suggested economic activity was regaining momentum early in the fourth quarter. The dollar was bid against the yen and clawed back some ground lost last week, rising 0.1% to 113.43 yen. The U.S. dollar index rose 0.1% to 94.308.Later on Monday no fewer than six Fed officials are speaking, with the most attention likely to be on Vice Chair Richard Clarida who is talking on Fed and ECB policy.Strong resistance can be seen at 113.73 (38.2%fib), an upside break can trigger rise towards 114.24(23.6%fib).On the downside, immediate support is seen at 113.24(50% fib), a break below could take the pair towards 112.84(61.8%fib).

Equities Recap

European shares opened flat on Monday after optimism around a strong earnings season and the European Central Bank’s reiteration that inflation is temporary was offset by concerns ahead of U.S. inflation data this week.

At (GMT 09:00),UK's benchmark FTSE 100 was last trading up at 0.01 percent, Germany's Dax was down by 0.12 percent, France’s CAC was last up by 0.21 percent.

Commodities Recap

Gold prices eased from a two-month high on Monday pressured by rising U.S. yields, although expectations that key central banks will keep interest rates low in the near term underpinned the non-yielding asset.

Spot gold was flat at $1,817.28 per ounce by 1013 GMT. U.S. gold futures for December delivery rose 0.1% to $1,818.60 per ounce.

Oil prices rose on Monday as positive signs for global economic growth supported the outlook for energy demand, while Saudi Arabia's state-owned producer Aramco raised the official selling price for its crude.

Brent crude was up by 91 cents, or 1.1%, at $83.65 a barrel at 1028 GMT, after dropping nearly 2% last week. U.S. oil gained $1.13, or 1.39%, to $82.40, having declined almost 3% through Friday.

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