Markets are mixed to steady today following the FOMC Minutes with all eyes now turning towards the weekend G20 Meeting. The meetings showed that almost all policy makers saw a rate hike warranted ‘fairly soon’, with further gradual hikes ahead, consistent with goals. Earlier in the session, the US$ had an early bid tone although this faltered after some soft US inflation data. The headline PCE figure was unchanged at 2.0% yy in October versus consensus of 2.1% while the Core PCE slowed to 1.8% yy, down from 2.0% yy and missed consensus of 1.9% yy. On the bright side, personal income rose 0.5% while spending rose 0.6%, both above expectations.
FX markets have been choppy but mostly unchanged although Sterling remains heavy amid growing concerns about the UK parliament’s vote on Brexit and after the Bank of England warned of risks to the currency if Britain leaves the European Union in a disorderly manner.
Stocks and the metals are also steady. WTI fell below 50.00 but then recovered on talk that Russia might contribute after all to an oil production cut at the enlarged OPEC+ meeting on Dec. 6.
Looking ahead to Friday, the real focus is going to be on the G20 Meeting and trump’s meeting with president Xi although there is unlikely to be any real detail until the markets are closed for the weekend so be prepared for potential gaps on Monday. Ahead of that Asia will see the NZ Building Permits, Tokyo CPI, Australian Private Sector Credit and the China Mfg/Non-Mfg PMIs. Europe will focus on the November CPI (exp 2.0%yy, Core 1.1%) while the US will be somewhat empty, with just the Chicago Purchasing Managers Index due. Central bank speakers will include the ECB’s Mersch and the Fed’s Williams. Have a good weekend.
Economic data highlights will include:
Fri: G20 Meeting, NZ Building Permits, Tokyo CPI, Japan Unemployment, Industrial Production, Australian Private Sector Credit, , China Mfg/Non-Mfg PMIs, German Retail Sales, EU Unemployment, CPI, Chicago Purchasing Managers Index
| CURRENCIES | |||
|---|---|---|---|
| EURUSD: 1.1382 | |||
| Res | 1.1400 | 1.1420 | 1.1440 |
| Sup | 1.1370 | 1.1350 | 1.1330 |
| USDJPY: 113.42 | |||
| Res | 113.65 | 113.90 | 114.15 |
| Sup | 113.20 | 113.00 | 112.85 |
| GBPUSD: 1.2778 | |||
| Res | 1.2805 | 1.2825 | 1.2850 |
| Sup | 1.2755 | 1.2720 | 1.2690 |
| USDCHF: 0.9964 | |||
| Res | 1.0005 | 0.9985 | 1.0030 |
| Sup | 0.9945 | 0.9915 | 0.9885 |
| AUDUSD: 0.7317 | |||
| Res | 0.7340 | 0.7360 | 0.7380 |
| Sup | 0.7300 | 0.7280 | 0.7255 |
| NZDUSD: 0.6856 | |||
| Res | 0.6885 | 0.6915 | 0.6940 |
| Sup | 0.6840 | 0.6815 | 0.6790 |
| INDICES / COMMODITIES | |||
|---|---|---|---|
| S&P.FS: 2748 | |||
| Res | 2755 | 2765 | 2775 |
| Sup | 2735 | 2725 | 2715 |
| DJ30.FS: 25419 | |||
| Res | 25500 | 25635 | 25755 |
| Sup | 25300 | 25200 | 25070 |
| SPI200.FS: 5757 | |||
| Res | 5770 | 5790 | 5815 |
| Sup | 5735 | 5715 | 5690 |
| XAUUSD: 1224 | |||
| Res | 1225 | 1230 | 1235 |
| Sup | 1220 | 1215 | 1210 |
| XAGUSD: 14.30 | |||
| Res | 14.40 | 14.50 | 14.60 |
| Sup | 14.25 | 14.15 | 14.05 |
| WTI.FS: 51.48 | |||
| Res | 52.30 | 53.50 | 54.60 |
| Sup | 50.80 | 49.50 | 48.55 |