This week will be full of a variety of macroeconomic reports – there will be plenty for the market to get excited about.
USD: weak position
The US dollar is suffering due to the optimism of market participants and their belief that the Fed will raise rates by fewer points at the December meeting than it has done previously. Investors will look to the statistics to support their theory. Watch out for US service sector activity in November as well as consumer lending in October. The USD exchange rate remains in a weak position.
AUD: rate decision already taken into account
The Reserve Bank of Australia will meet to decide on the interest rate. The rate is expected to rise from 2.85% to 3.1% per annum. Expectations are already reflected in the AUD exchange rate and without new details the “aussie” could continue to rise.
JPY: yen still rising
Japan will publish a very important report – household spending figures for October. They are assumed to have increased by 1.5% m/m after an expansion of 1.8% m/m in September. On a year-on-year basis it is forecast to rise by 1% which is lower than in the previous report. Reduced data will be a leading signal ahead of the inflation report, a negative situation. The JPY is still appreciating but only due to USD weakness.
EUR: too high a price
The Eurozone is preparing a big stream of statistics for release – including a GDP estimate for Q3. The Sentix investor sentiment index for the region is expected to improve in December. In addition, ECB head Christine Lagarde is scheduled to give a speech. EUR looks unjustifiably expensive.
China: waiting for signals
China will present data on inflation and the producer price index as well as parameters for new lending in the country. Strong Chinese statistics usually provide support for risk assets, but in this case there may not be any positive signals.
The post A Week in the Market: Weak Dollar and Flow of Statistics (5 – 9 December) appeared first at R Blog – RoboForex.