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US Morning Notes

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USD mixed, BOE increases asset purchases by £25bln

Thu, Nov 5 2009, 14:15 GMT
by Michael J. Malpede

Easy Forex

FX Highlights

• The USD is trading lower pressured by the Fed's decision Wednesday to maintain low yields for an extended period, GBP supported by a report that the BOE increased its asset purchases by less than expected and UK industrial and manufacturing output came in higher than expected, ECB elects to hold rate policy unchanged, AUD supported by hawkish comments from RBA Governor Stevens that neutral policy is higher than the current level of interest rates, JPY supported by risk aversion as stocks fall in Asia

• Focus turns to today’s release of US jobless claims, productivity and unit labor costs and Canada’s building permits and Ivey PMI

• BOJ minutes for the October 13-14th policy meeting state that most board members agreed to keep monetary policy accommodative, JPY higher

• Australia’s September trade deficit rises to 1.849bln compared to 1.612bln deficit in August, exports and imports rose 5%, October vehicle sales rose 3.4%, RBA Governor Stevens says neutral policy is higher than for current level of interest rates

• UK September industrial production rose 1.6%, manufacturing output rose 1.7%, BOE elects to hold rate policy unchanged and will add £25bln to its asset purchase program, GBP mixed

• EU September retail sales fall 0.7%, ECB elects to leave monetary policy unchanged, focus turns to the press conference following the ECB policy decision, EUR mixed

• Swiss Q4 consumer sentiment Index improves to -30 from -42 last month, October CPI rises 0.6%

• NYU economist Roubini warns that the rally in risk assets may end abruptly, he went on to say that the USD may rally 20% over the next six months, Pimco’s El –Erian says that the Fed is fueling the USD carry trade

• Consumer bankruptcies were up 27.9% in October says the American Bankruptcy Institute

• US equity markets set to open mixed, European equities 0.5% lower, Nikkei closed 127 points lower

Upcoming Events

• US – Thursday, jobless claims for week ending 10/31 will be released expected at 521k compared to 530k last week along with Q3 productivity expected at 5.5% and unit labor costs at -4.5%

• CAN – Thursday, September building permits will be released expected at 1.6% compared to 7.2% last month along with October Ivey PMI expected at 59 compared to 61.7 last month

• Download Full US Morning Notes

Published on  Thu, Nov 5 2009, 14:19 GMT