Europe Roundup:
•French CPI NSA (YoY) (Sep) 1.10%,1.20% previous
•French CPI (MoM) (Sep) -1.3%, -1.2% forecast, 0.5% previous
•French CPI (YoY) (Sep) 1.1%, 1.2% forecast, 1.8% previous
•French HICP (YoY) (Sep) 1.4% 1.5% forecast, 1.5% previous
•French HICP (MoM) (Sep) -1.3%,-1.2% forecast, 1.2% previous
•France Inflation (YoY) (Sep) 1.00%,1.70% previous
• Spanish Core CPI (YoY) (Sep) 2.4%,2.4% forecast,2.7% previous
•Spanish CPI (MoM) (Sep)-0.6% ,-0.6% forecast, 0.0% previous
•Spanish CPI (YoY) (Sep) 1.5%, 1.5% forecast, 2.3% previous
•Spanish HICP (MoM) (Sep) -0.1%-0.1% forecast, 0.0% previous
•Spanish HICP (YoY) (Sep) 1.7%,1.7% forecast, 2.4% previous
•EU Industrial Production (MoM) (Aug) 1.8%,1.8% forecast,-0.5% previous
•German ZEW Current Conditions (Oct) -86.9-84.5 forecast,-84.5 previous
•German ZEW Economic Sentiment (Oct) 13.1,10.2 forecast,3.6 previous
•German ZEW Economic Sentiment (Oct) 20.1,16.9 forecast,9.3 previous
Looking Ahead Economic Data (GMT)
•12:30 US NY Empire State Manufacturing Index (Oct) 3.40 forecast, 11.50 previous
•12:30 Canada Common CPI (YoY) (Sep) 2.1% forecast, 2.0% previous
•12:30 Canada Core CPI (MoM) (Sep) -0.1% previous
•12:30 Canada Core CPI (YoY) (Sep) 1.5% previous
•12:30 Canada CPI (YoY) (Sep) 1.8% forecast, 2.0% previous
•12:30 Canada CPI (MoM) (Sep) -0.2% forecast, -0.2% previous
•12:30 Canada Median CPI (YoY) (Sep) 2.3% forecast, 2.3% previous
•12:30 Canada Trimmed CPI (YoY) (Sep) 2.4% forecast, 2.4% previous
•12:30 Canada Wholesale Sales (MoM) (Aug) -1.1% 0.4% previous
•12:55 USD Redbook (YoY) 5.4% previous
•14:00 Global Dairy Trade Price Index 1.2% previous
•15:00 US NY Fed 1-Year Consumer Inflation Expectations (Sep) 3.0% previous
•15:30 US 3-Month Bill Auction 4.550% previous
•15:30 US 6-Month Bill Auction 4.305% previous
Looking Ahead Events And Other Releases
•15:30 US FOMC Member Daly Speaks
•17:05 US FOMC Member Kugler Speaks
Currency Forecast
EUR/USD: The euro was little changed against dollar on Tuesday as investors awaited the European Central Bank policy meeting on Thursday, where the central bank looks set to deliver another interest rate cut. The ECB is widely expected to cut rates on Thursday, with over 90% of economists polled predicting a 25-basis-point reduction to 3.25% after September's inflation dipped below 2%; most expect another 25 bps cut in December. The tone of the monetary policy statement and press conference will be key for expectations. The euro zone's data highlights are final September HICP,August trade and industrial production, and the German ZEW survey. Immediate resistance can be seen at 1.1005(38.2%fib), an upside break can trigger rise towards 1.1053(50%fib).On the downside, immediate support is seen at 1.0944(23.6%fib), a break below could take the pair towards 1.0920 (Lower BB).
GBP/USD: Sterling strengthened against dollar on Tuesday after mixed labour market data. British pay grew at its slowest rate in more than two years in the three months to August, according to official data, but the unemployment rate fell to 4% - its lowest reading this year - and employment jumped by the most on record.However, the statistics agency stepped up its health warning over the Labour Force Survey amid falling response rates, saying it likely overstated employment growth and the fall in unemployment. The pound was last up 0.2% at $1.3084, hovering above last week's one-month low of $1.3011.Immediate resistance can be seen at 1.3127(38.2%fib), an upside break can trigger rise towards 1.3188(50%fib).On the downside, immediate support is seen at 1.3060(23.6%fib), a break below could take the pair towards 1.3000(Psychological level).
NZD/USD: The New Zealand dipped on Tuesday as US dollar as the dollar rallied further on bets that the Federal Reserve will take a more moderate approach to cutting interest rates in the upcoming meetings. A series of U.S. data has indicated that the economy remains resilient, slowing only modestly, while inflation in September rose slightly more than expected. This has led traders to reduce their expectations for significant rate cuts from the Federal Reserve. The central bank initiated its easing cycle with an aggressive 50 basis point cut at its last policy meeting in September. Currently, traders are pricing in an 89% chance of a 25 basis point cut in November, with a total of 45 basis points of easing expected for the year. Immediate resistance can be seen at 0.6116(38.2%fib), an upside break can trigger rise towards 0.6161 (50%fib).On the downside, immediate support is seen at 0.6059 (23.6%fib), a break below could take the pair towards 0.6000(Psychological level).
USD/JPY: The dollar steadied against the yen on Tuesday as dollar was driven by expectations that the Federal Reserve will implement modest rate cuts soon . A string of U.S. data has shown the economy to be resilient and slowing only modestly, while inflation in September rose slightly more than expected, leading traders to trim bets on large rate cuts from the Fed.The U.S. central bank kicked off its easing cycle with an aggressive 50 basis points at its last policy meeting in September. Traders are now ascribing 89% chance of a 25 bps cut in November, with 45 bps of easing priced in for the year. The dollar last fetched 149.19 per yen in early trading, having touched a 2-1/2 month high of 149.98 on Monday. Immediate resistance can be seen at 149.83(Daily high), an upside break can trigger rise towards 150.00(Psychological level). On the downside, immediate support is seen at 147.61(38.2 %fib), a break below could take the pair towards 147.00(Psychological level).
Equities Recap
European shares turned lower after hitting an over two-week high earlier on Tuesday, weighed down by mining and energy stocks, with investors also monitoring the corporate earnings season and the central bank's interest rate decision due later this week.
UK's benchmark FTSE 100 was down by 0.53 percent, Germany's Dax was up by 0.40 percent, France’s CAC was down by 0.74 percent.
Commodities Recap
Gold prices held steady on Tuesday as the U.S. dollar remained near two-month highs, with markets caught between profit-taking and prospects for further rate cuts by the Federal Reserve.
Spot gold was up 0.1% to $2,654.58 per ounce at 0955 GMT and U.S. gold futures rose 0.2% to $2,671.80.
Oil prices tumbled more than 4% to a near two-week low on Tuesday due to a weaker demand outlook and after a media report said Israel is willing to not strike Iranian oil targets, easing fears of a supply disruption.
Brent crude futures fell $3.51, or 4.5%, to $73.95 a barrel at 0911 GMT, their lowest since Oct. 2. West Texas Intermediate futures lost $3.48, or 4.7%, hitting $70.35 a barrel.
