rahul.khanna's picture

Trending Economic: US Session [30 November 15]

We see further EUR weakness heading into ECB meeting on Thursday. The market is already pricing in a 15bp cut to the deposit rates, and partially pricing in some addition to the ECB asset purchase programme. However, risk remains that ECB may under-deliver slightly than what market currently expects, in which case there will be some short-term recovery ex post. In terms of economic data out of Europe on Monday, the German retail sales m/m has come in at -0.4%, worse than expected 0.4%, and down from previous 0%. However, the German Preliminary CPI m/m for November improved to 0.4%, compared to expectations of 0.3%. Overall these data points should have a small impact on EUR.

Overnight New Zealand ANZ Business Confidence came in at 14.6 versus 10.5 previously. NZD is now the strongest currency for the day & the past week. NZD strength versus the other G10 currencies over the coming days is dependent on China Manufacturing PMI and GDT price index on Tuesday. 

The SEK remains strong and over the past few weeks the economic data continues to improve, latest being the Q3 GDP release which came in well above expected. This further reduces the probability of further easing from Riksbank at the next policy meeting. Elsewhere Norway’s Loan growth for October y/y came in at 5.7%, above the expected 5.6%. The figure is also up from previous 5.6%. 

Overnight Manufacturing PMI comes out of China at 0100 GMT & the RBA policy meeting is scheduled for 0330 GMT. Looking ahead we see some key economic data out of US this week such as the US CPI on Wednesday and US Non-farm Payrolls on Friday. We have a neutral view on USD ahead of these economic data points.