EUROZONE DATA TAKES THE FORE
Europe will move the markets on Monday, as investors get set to digest a flurry of economic data from the currency region.
Activity begins at 07:00 GMT with a report on German factory orders. Factory output in Europe’s largest economy is forecast to drop 1.5% in September, after rising 3.6% the previous month.
The Swiss government will report on consumer inflation at 08:15 GMT. The monthly report is expected to show a 0.2% increase in October, following a similar gain the previous month. This likely translates into an annualized gain of 0.8%.
Investors can also expect multiple PMI reports courtesy of IHS Markit. The research group will report on Italian, French, German and Eurozone services activity between 08:15 GMT and 0:9:00 GMT. The monthly reports will also include the Composite PMI indicator, which gauges manufacturing and services activity. Germany’s Composite gauge is expected to show a reading of 56.9. The euro area Composite indicator is expected to come in at 54.9.
At 09:30 GMT, Sentix will release its investor confidence index. The monthly gauge is expected to show an increase to 30.8 in November from a reading of 29.7 the previous month.
Meanwhile, a report on Eurozone inflation will make headlines at 10:00 GMT. The monthly producer price index (PPI) is expected to rise 0.4% in September, translating into a 2.8% year-over-year gain.
Shifting gears to North America, US Federal Reserve Chairwoman Janet Yellen will deliver a speech at 13:00 GMT. Yellen will be replaced by Fed Governor Jerome Powell as Chair of the US central bank next February.
New York Fed President William Dudley will also deliver a speech at 17:00 GMT.
Earlier in the day, the Reserve Bank of New Zealand (RBNZ) reported a slight downtick in inflation expectations. Third quarter inflation expectations slipped to 2% annually, official data showed. That’s down from 2.1% the previous month.
The euro was practically motionless on Monday, as market participants awaited key economic data. The EUR/USD exchange rate was last seen trading at 1.1612, where it was little changed compared with the previous close. The euro is vulnerable to further weakness but continues to trade in a narrow range.
Cable was little changed on Monday, as a dearth of market-moving developments kept investors on the sidelines. The GBP/USD exchange rate continues to hold above 1.3000, with upside limited to 1.3111, which is the high from Friday.
The New Zealand dollar fell against the greenback on Monday, as investors digested the latest inflation figures. The NZD/USD was down 0.2% at 0.6890, extending a three-week downtrend that has wiped more than 300 pips from the pair. The pair is expected to fall even further as the RBNZ remains on hold with respect to monetary policy while the Federal Reserve signals for higher rates. The NZD/USD faces immediate support at 0.6820. On the opposite side of the ledger, resistance is located at 0.6992.