Economic wrap: FOMC decision and NFP all coming up - Westpac

Ross J Burland FXStreet

Analysts at Westpac offered an economic wrap.

Key Quotes:

"US manufacturing PMI (ISM) rose from 51.5 to 51.9 in Oct (vs 51.7 expected). The Markit version was finalised higher at 53.4 (vs 53.2 expected). A recovery in mining and factory output, plus a smaller inventory overhang, is helping; although sluggish world growth remains a headwind. Construction spending fell 0.4% in Sep (vs +0.5% expected), although the details were upbeat. Small business sentiment (IBD) rose to 51.4 (vs 49.0 expected).

The GDT dairy auction delivered a large positive surprise. Whole milk powder rose 20%, against futures predictions of +10%. Reduced auction supply has been well flagged by Fonterra for many weeks, suggesting exuberant demand may have been at play last night.

Economic Event Risks Today

We expect NZ unemployment for Q3 to fall from 5.1% to 5.0%, with the median estimate unchanged at 5.1%. The report is expected to reflect solid economic activity, but note that this series has been erratic in the past and subject to later revisions. Also out in NZ is the important RBNZ inflation expectations survey (2yr ahead measure), which we expect to remain stuck at below 1.7%.

Australian dwelling approvals: the near term outlook depends on the highly uncertain high rise component. We expect a 2.5% fall in Sep.

The week’s highlight, the FOMC decision, should see the Fed remain on the sidelines but to again signal intent for Dec. ADP (private sector) payrolls is also due ahead of the main payrolls report on Friday. Both should show robust gains for employment."

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

GBP/USD clings to multi-day peaks below 1.3500

GBP/USD trades with marked gains on Friday, now giving away some gains following an earlier surpass of the key 1.3500 yardstick. Indeed, Cable gathers fresh steam amid the strong offered stance in the Greenback, all after US NFP badly missed expectations in July.

EUR/USD: Post-NFP bounce falters around 1.1580

EUR/USD reverses Thursday’s decline and trades with solid gains in the 1.1560 region, or two-month peaks, on Friday. The pair’s firm performance comes in a context of a sharp correction in the US Dollar as investors continue to assess disheartening US NFP readings.

How Wall Street rigs the game [Video]

In this week’s Live from the Vault, Andrew Maguire is joined by Peter Antico and Sean Stone to discuss the Paradigm of Money - an in-depth expose of financial market corruption, from naked shorting to the two-tier system that protects Wall Street.

XRP Price Forecast: XRP nears critical $1.00 support

Ripple (XRP) remains pressured on Friday, trading around $1.03 at the time of writing. The token appears to hold this current level as support but lacks a catalyst to sustain a knee-jerk rebound toward the next key resistance at $1.10.

Is Gold about to enter its biggest bull run since 2020?

Gold has stormed back into the spotlight and its next move could leave late buyers chasing. On August 5, the yellow metal surged almost 7% – roughly $174 – to close near $4,308 an ounce, posting one of its biggest daily advances in recent history. A weaker U.S dollar, falling Treasury yields, changing Federal Reserve expectations and renewed safe-haven demand all struck at once.

9-3: Is the Federal Reserve’s vote tally Warsh's new forward guidance?

The rate did not move. Neither did the statement, and that’s the more interesting fact. Set the July 29 Federal Open Market Committee (FOMC) statement beside the one issued on June 17, and the two documents are identical apart from a single verb and a paragraph at the bottom naming three dissenters.