Market Outlook - Monday, October 23

Welcome to the weekly outlook starting this Monday, October 23. We’ll be looking at the week’s key economic events on the financial calendar covering Monday to Thursday. As you’ll read below, it’s an active economic news week with releases coming from all major economies around the globe. On Friday, we also get inflation figures from the US with the Consumer Price Index for October due at 12:30 GMT.

Event: EU Market Services, Manufacturing and Composite PMI (October)

Date: Tuesday 24 October 2017 at 08:00 GMT

Markets affected: EUR/USD, EUR/GBP

Trending hashtags: #eur, #pmi

Business executives in the Eurozone manufacturing and services sectors showed confidence in the common region last month with the PMI releases by Markit Economics confidently above the 50 mark which shows confident growth. Markit Services came in at 55.8, the Markit Manufacturing PMI was 58.1 while the combined Markit PMI Composite showed an improvement on previous months with 56.7.

Event: Australia Consumer Price Index (Q3)

Date: Wednesday 25 October 2017 at 00:30 GMT

Markets affected: AUD/USD, AUD/NZD

Trending hashtags: #aud, #cpi

Important inflation data is due out for Australia on Wednesday. The aussie dollar experienced volatility last week with retail sales below expectations but then seeing the lowest unemployment rate for a number of years. The Reserve Bank of Australia will be closely following the release of the consumer price index which saw 0.2% growth in the second quarter from the first quarter and an annualised growth of 1.9%.

Event: UK Gross Domestic Product (preliminary)

Date: Wednesday 25 October 2017 at 08:30 GMT

Markets affected: GBP/USD, EUR/GBP

Trending hashtags: #gbp, #gdp

 

Estimates for third quarter GDP are due out for the UK. The economy grew 0.3% on a quarterly basis during the second quarter with 1.5% annualised growth. Analysts are expecting a slight improvement for the third quarter at 1.8%. With a number of challenges facing the UK economy around the Brexit negotiations, the Bank of England will be on the lookout for signals to consider tightening monetary policy again. 

Event: Bank of Canada Interest Rate Report

Date: Wednesday 25 October 2017 at 14:00 GMT

Markets affected: CAD/USD

Trending hashtags: #cad, #interestrate

While the Canadian economy has been outperforming it’s G7 counterparts, the Bank of Canada may take caution in making any changes to its current 1% interest rate. Last week retail sales fell by 0.3% in August and inflation has only grown 0.2% in September – both figures missed forecasts and may deter the central bank on making any modifications to the benchmark rate at this time.

Event: New Zealand Trade Balance (September)

Date: Wednesday 25 October 2017 at 21:45 GMT

Markets affected: NZD/USD, AUD/NZD

Trending hashtags: #nzd, #trade

Trade data is due out for New Zealand which will be key in helping the struggling kiwi. The NZD took a tumble last week as the NZ First party threw its support behind the Labour Party and raising fears of increased spending on housing and wages taking a toll on the country’s debt level. Imports last month came in at $4.92 billion with exports at only $3.69 billion. With a monthly balance of $-1,235 million the overall year’s level is currently sitting on$-3.2 billion.

Event: ECB Interest Rate Decision

Date: Thursday 26 October 2017 at 11:45 GMT

Markets affected: EUR/USD, EUR/GBP

Trending hashtags: #eur, #interestrate

One of the main events in this week’s calendar comes on Thursday with the European Central Bank’s decision on interest rates which are currently 0% and deposit rate at -0.4%. ECB President, Mario Draghi, has commented on a reduction on the monthly bond purchasing programme which has been in place for three years now. The Markets will be on the lookout for any further news on that front.

 
References

https://www.fxstreet.com/economic-calendar
http://www.nzadviseronline.co.nz/news/dollars-falls-on-labour-news-242599.aspx