Jens Nærvig Pedersen
Danske Bank A/S
Market Movers
On the data front, we are looking for German ZEW expectations to have risen to 8.2 from 1.9. October’s CPI in the UK and the US may also attract some attention today. We are looking for a slight drop in UK CPI inflation and a slight rise in US CPI inflation.
On the monetary policy front, the market will listen to what ECB’s Lautenschlager and Fed’s Tarullo have to say about what may be in store at the upcoming ECB and Fed meetings in December.
The oil market in particular, will keep an eye on potential geopolitical ramifications of the terrorist attack in Paris on Friday. The conflict is centred around Syria, which limits the impact on the oil price, as Syria is not a big oil producer.
In Scandi markets, the Norwegian Q3 GDP figure is due for release today – we are looking for 0.1% q/q mainland GDP growth in Q3 down from 0.2% q/q in Q2 and slightly lower than what Norges Bank has previously forecasted.
Selected Market News
A number of ECB members spoke yesterday. Coeure and Constancio downplayed the risk of asset price bubbles and Constancio further underlined that ECB policy aims at intensifying risk taking. These comments should fuel the expectation that the ECB is set to ramp up its bond purchase programme at its December meeting.
ECB’s Praet said that the ECB will need to monitor economic confidence following the terrorist attacks. Judging from developments in financial markets yesterday, economic confidence may not have suffered to any larger extent as risk assets in general were well supported on the first trading day following the attacks.
French president Hollande held a speech yesterday in which he promised to increase spending on security, limit constitutional protections and win a war against Islamic terrorism. Hollande furthermore said that he would call US president Obama and Russian president Putin to unite efforts to find a solution.
This publication has been prepared by Danske Bank for information purposes only. It is not an offer or solicitation of any offer to purchase or sell any financial instrument. Whilst reasonable care has been taken to ensure that its contents are not untrue or misleading, no representation is made as to its accuracy or completeness and no liability is accepted for any loss arising from reliance on it. Danske Bank, its affiliates or staff, may perform services for, solicit business from, hold long or short positions in, or otherwise be interested in the investments (including derivatives), of any issuer mentioned herein. Danske Bank's research analysts are not permitted to invest in securities under coverage in their research sector.
This publication is not intended for private customers in the UK or any person in the US. Danske Bank A/S is regulated by the FSA for the conduct of designated investment business in the UK and is a member of the London Stock Exchange.
Copyright () Danske Bank A/S. All rights reserved. This publication is protected by copyright and may not be reproduced in whole or in part without permission.
Recommended Content
Editors’ Picks
EUR/USD edges lower toward 1.0700 post-US PCE
EUR/USD stays under modest bearish pressure but manages to hold above 1.0700 in the American session on Friday. The US Dollar (USD) gathers strength against its rivals after the stronger-than-forecast PCE inflation data, not allowing the pair to gain traction.
GBP/USD retreats to 1.2500 on renewed USD strength
GBP/USD lost its traction and turned negative on the day near 1.2500. Following the stronger-than-expected PCE inflation readings from the US, the USD stays resilient and makes it difficult for the pair to gather recovery momentum.
Gold struggles to hold above $2,350 following US inflation
Gold turned south and declined toward $2,340, erasing a large portion of its daily gains, as the USD benefited from PCE inflation data. The benchmark 10-year US yield, however, stays in negative territory and helps XAU/USD limit its losses.
Bitcoin Weekly Forecast: BTC’s next breakout could propel it to $80,000 Premium
Bitcoin’s recent price consolidation could be nearing its end as technical indicators and on-chain metrics suggest a potential upward breakout. However, this move would not be straightforward and could punish impatient investors.
Week ahead – Hawkish risk as Fed and NFP on tap, Eurozone data eyed too
Fed meets on Wednesday as US inflation stays elevated. Will Friday’s jobs report bring relief or more angst for the markets? Eurozone flash GDP and CPI numbers in focus for the Euro.