COVID-19, Economic Data, the ECB, and U.S Politics to Keep the Markets Busy

Bob Mason
·4-min read

Earlier in the Day:

It’s was a busy start to the day on the economic calendar this morning. The Aussie Dollar, Kiwi Dollar, and the Japanese Yen were in action in the early part of the day. On the monetary policy front, the Bank of Japan will also deliver its first monetary policy decision of the quarter later this morning.

Away from the economic calendar, U.S politics and COVID-19 continued to be the main area of focus.

For the Japanese Yen

According to the Ministry of Economy, Trade, and Industry, retail sales tumbled by 8.7% in September, year-on-year, following a 1.7% decline in August. Economists had forecast a 7.7% slide.

The Japanese Yen moved from ¥104.288 to ¥104.388 upon release of the dire figures that preceded the BoJ monetary policy decision. At the time of writing, the Japanese Yen was down by 0.02% ¥104.34 against the U.S Dollar.

For the Kiwi Dollar

The ANZ Business Confidence Index rose from -28.5 to -15.7 in October, while down from a prelim -14.5. In September, the Index had risen from -41.8 to -28.5.

According to the latest ANZ Report,

  • Forward-looking indicators saw a marked improvement in October.

  • Since April, the “own activity” indicator has risen from -55% to +4.7%. In October, employment intentions rose from -11.8% to -2.5%.

  • Investment intentions increased from 0.3% to 1.9%, which was also up from a prelim 1.4%.

  • Export intentions fell from a prelim 2.1% to -3.5%, while up from September’s -4.7%.

The Kiwi Dollar moved from $0.66483 to $0.66531 upon release of the figures. At the time of writing, the Kiwi Dollar was up by 0.17% to $0.6650.

For the Aussie Dollar

Business confidence was in focus early this morning. In the 3rd quarter, the NAB Quarterly Business Confidence Index rose from -15 to -10 in the 3rd quarter.

The Aussie Dollar moved from $0.70635 to $0.70666 upon release of the figures. At the time of writing, the Aussie Dollar was up by 0.28% to $0.7065

The Day Ahead:

For the EUR

It’s a busy day ahead on the economic calendar.

Key stats include October unemployment figures and prelim October inflation figures from Spain and Germany.

Expect Germany’s unemployment change figure to have the greatest influence.

On the monetary policy front, the ECB policy decision and press conference will be the main event of the day, however.

With COVID-19 forcing a reintroduction of lockdown measures, the markets will be looking for an ECB response…

Away from the economic calendar, expect Brexit and COVID-19 chatter to also influence.

At the time of writing, the EUR was up by 0.06% to $1.1753.

For the Pound

It’s yet another quiet day ahead on the economic calendar, with no material stats to provide the Pound with direction.

The lack of stats will continue to leave the Pound squarely in the hands of Brexit chatter, COVID-19, and market risk sentiment.

At the time of writing, the Pound was up by 0.08% to $1.2994.

Across the Pond

It’s a busier day ahead for the U.S Dollar.

Key stats include 3rd quarter GDP and weekly initial jobless claims figures. The markets will be looking for a rebound from the 2nd quarter’s economic meltdown. Anything disappointing will test market risk appetite.

Jobless claims will also need to continue its downward trend. The latest spike in new COVID-19 cases could limit the impact of any positive numbers, however.

Housing sector figures for September should have a muted impact on the day. Pending home sales figures are due out late in the day.

Away from the economic calendar, COVID-19 and U.S politics will continue to provide direction…

At the time of writing, the Dollar Spot Index was up by 0.02% to 93.424.

For the Loonie

It’s a relatively quiet day on the economic data front, with key stats limited to September building permit figures.

Following Wednesday’s BoC monetary policy decision, however, the numbers are unlikely to have a material impact on the Loonie.

COVID-19 and market sentiment towards the U.S and global economic outlook will be key drivers on the day.

At the time of writing, the Loonie was up by 0.11% to C$1.3309 against the U.S Dollar.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire

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