Market Roundup
•UK Business Investment (QoQ) (Q2): 1.4%, -0.1% forecast, 0.6% previous
•UK Current Account (Q2): -28.4B, -32.5B forecast, -13.8B previous
•UK GDP (YoY) (Q2): 0.7%, 0.9% forecast, 0.3% previous
•UK GDP (QoQ) (Q2): 0.5%, 0.6% forecast , 0.7% previous
•UK GBP Nationwide HPI (MoM) (Sep): 0.7%, 0.3% forecast, -0.2% previous
•UK GBP Nationwide HPI (YoY) (Sep) 3.2%, 4% previous:
•German CPI (YoY) (Sep): 1.6%, 1.7% forecast, previous: 1.9%
•German CPI (MoM) (Sep) 0.0%, 0.1% forecast, previous: -0.1%
•German HICP (YoY) (Sep) 1.8%, 1.9% forecast, previous: 2.0%
•German HICP (MoM) (Sep) -0.1%, -0.2% previous
Looking Ahead Economic Data(GMT)
• 13:00 US Dallas Fed PCE (Aug): 1.70% previous
• 13:00 French 12-Month BTF Auction: 2.789% previous
• 13:00 French 3-Month BTF Auction: 3.367% previous
• 13:00 French 6-Month BTF Auction: 3.116% previous
• 13:45 US Chicago PMI (Sep): 46.1, 46.1 previous
•14:30 US Dallas Fed Mfg Business Index (Sep): -4.5, -9.7 previous
•15:30 US 3-Month Bill Auction: 4.540% previous
•15:30 US 6-Month Bill Auction: 4.270% previous
Looking Ahead Economic Data(GMT)
• US Fed Chair Powell Speaks
Currency Forecast
EUR/USD: The euro firmed against the dollar on Monday after data showed German inflation eased in September. German inflation eased slightly more than forecast to 1.8% in September, preliminary data from the federal statistics office showed on Monday.Analysts polled had forecast a reading of 1.9% in September, after a year-on-year increase in consumer prices of 2.0% in August, based on data harmonised to compare with other European Union countries. Immediate resistance is noted at 1.1191 (23.6%fib), with a breakout potentially pushing the pair towards 1.1216 (Higher BB). On the downside, immediate support is at 1.1114 (38.2%fib), a drop below this level could lead the pair towards 1.1072 (Sep 19th low).
GBP/USD: Sterling edged higher on Monday as expectations that the Bank of England will be relatively cautious in cutting interest rates compared to the Federal Reserve and European Central Bank boosyed sterling . The BoE kept rates on hold in September, after cutting in August, and markets are only fully pricing one further 25 basis- point rate cut by year end.In contrast, the ECB has cut rates twice this cycle, and analysts expect two more 25 bp cuts by December, while markets are pricing round 70 bps of further cuts across the Fed's remaining two meetings, after September's large 50 bp move. Sterling was up 0.2% on the dollar at $1.3402. Immediate resistance can be seen at 1.3417(23.6%fib), an upside break can trigger rise towards 1.3449(Higher BB).On the downside, immediate support is seen at 1.3335(38.2%fib), a break below could take the pair towards 1.3274(50%fib).
AUD/USD: The Australian dollar hit 20 month high on Monday as jump in iron ore prices and weaker greenback bolstered Australian dollar. Iron ore futures surged for a fifth straight session on Monday, as top consumer China's latest property stimulus and a raft of monetary easing policies brightened the key steelmaking ingredient's demand outlook. The Aussie rose 0.2% to $0.6941, just a touch higher than $0.6937 hit on Friday. It surged 1.4% last week .Immediate resistance can be seen at 0.6945(23.6%fib), an upside break can trigger rise towards 0.6972(Higher BB).On the downside, immediate support is seen at 0.6895(Daily low), a break below could take the pair towards 0.6857(38.2%fib).
USD/JPY: The dollar edged higher against the yen on Monday as investors anxiously waited for more direction from new Prime Minister Shigeru Ishiba, who has been critical of the Bank of Japan's easy policies in the past. Continued Israeli strikes across Lebanon added geopolitical uncertainty to the mix, though oil prices were still weighed down by the risk of increased supply.The week is packed with major U.S. economic data including a payrolls report that could decide whether the Federal Reserve delivers another outsized rate cut in November. The dollar was last up 0.17% at 142.45 yen.Strong resistance can be seen at 144.73 (38.2%fib), an upside break can trigger rise towards 145.00 (psychological level). On the downside, immediate support is seen at 141.60(23.6%fib), a break below could take the pair towards 140.36(Lower BB).
Equities Recap
European shares dipped on Monday as investor caution set in at the start of a week filled with key economic data from the region, with attention shifting to remarks from ECB President Christine Lagarde.
UK's benchmark FTSE 100 was down by 0.66 percent, Germany's Dax was up by 0.74 percent, France’s CAC finished the was down by 1.74 percent.
Commodities Recap
Gold eased from its recent record high on Monday, but was still set for its biggest quarterly gain in more than eight years on the back of geopolitics and the U.S. Federal Reserve's rate cut.
Spot gold was down 0.6% to $2,641.50 per ounce as of 1203 GMT and U.S. gold futures fell 0.2% to $2,663.50.
Oil prices declined on Monday and were on track to fall for the third month in a row as a strong supply outlook and questions around demand outweighed fears that Israeli strikes in Lebanon and Yemen could escalate conflict in the Middle East.
Brent crude futures for November delivery, expiring on Monday, lost 66 cents, or 0.9%, to $71.32 a barrel as of 1140 GMT. The more active December contract fell 41 cents, 0.6%, to $71.13. U.S. West Texas Intermediate (WTI) futures lost 51 cents, 0.8%, to $67.67 a barrel.
