Even though none of the central banks raised rates, the market was most surprised by the Bank of England who “failed” to raise rates and in turn the market quickly bailed its long GBP positions.
Coming up this week we do have central bankers Powell, Lagarde and Bailey all speaking and although rates clearly won’t move, they may well be asked or advise as to why they didn’t move on rates.
The FED did allow that they were tapering, and the surprise was that stocks remained on their highs although Biden’s stimulus package is not dead yet. The decent unemployment figures and a general desire to buy USD’s have kept the USD supported.
We don’t have a huge amount of important data being released this week, but Michigan consumer confidence has significance as it is seen as a contemporary measure of the US economy as well as its recovery from COVID, so it could provide volatility at the end of the week.
The COVID epicentre has moved to Europe which will probably undermine or at least limit EUR/USD rallies.
Commodities are heavily skewed towards China and the ramping up of coal production. Energy generation in China has caused metals to come off as their underlying cost base is dropping however, they remain in recent ranges and there is enough support to weather the Chinese economy slide as well as the authorities’ efforts to cap the prices.
Oil prices have recovered after Aramco raised its prices to Asia, following their slip last week on stock builds, and this is against demand dropping in the region to three-year lows.
Date | Country | Figures | Expected | Previous |
Nov 09 | USA | PPI YoY | 8.7% | 8.6% |
Nov 10 | USA | CPI YoY | 4% | 4% |
Nov 11 | GBP | Trade balance | -£12b | -£14.27b |
| GBP | GDP QoQ | 1.5% | 5.5% |
| USA | Initial Jobless Claims | 265k | 269k |
Nov 12 | USA | Michigan Consumer Confid | 72.5 | 71.7 |
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