Talking Points:
- British Pound Vulnerable if Soft PMI Data Weighs on BOE Tightening Bets
- US Dollar May Rise if ISM Print Builds on Hawkish FOMC Policy Statement
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October’s UK Manufacturing PMI data headlines the economic calendar in European trading hours. Expectations point to a print at 51.3, marking the third consecutive slowdown in the pace of factory-sector activity growth. UK news-flow has weakened relative to consensus forecasts recently (according to data from Citigroup), opening the door for a downside surprise. That may stoke speculation of a dovish turn in BOE rhetoric at this week’s policy meeting, weighing on the British Pound.
Later in the day, the spotlight turns to the US ISM Manufacturing index. A drop to 50.0 is expected, amounting to the fourth consecutive deterioration and the lowest reading since December 2012. Realized US data outcomes have cautiously improved relative to expectations in the past month, recent disappointments notwithstanding. That hints at the possibility of a better-than-forecast print, which could build on last week’s hawkish FOMC statement and boost the US Dollar.
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Asia Session
| GMT | CCY | EVENT | ACT | EXP | PREV |
|---|---|---|---|---|---|
| 01:00 | CNY | Manufacturing PMI (OCT) | 49.8 | 50.0 | 49.8 |
| 01:00 | CNY | Non-manufacturing PMI (OCT) | 53.1 | - | 53.4 |
| 22:30 | AUD | AiG Perf of Mfg Index (OCT) | 50.2 | - | 52.1 |
| 23:00 | AUD | CoreLogic RP Data House Px (MoM) (OCT) | 0.2% | - | 0.9% |
| 23:30 | AUD | TD Securities Inflation (MoM) (OCT) | 0.0% | - | 0.3% |
| 23:30 | AUD | TD Securities Inflation (YoY) (OCT) | 1.8% | - | 1.9% |
| 00:30 | AUD | Building Approvals (MoM) (SEP) | 2.2% | 1.0% | -9.5% |
| 00:30 | AUD | Building Approvals (YoY) (SEP) | 21.4% | 24.1% | 4.7% |
| 01:35 | JPY | Nikkei Japan PMI Mfg (OCT F) | 52.4 | - | 52.5 |
| 01:45 | CNY | Caixin China PMI Mfg (OCT) | 48.3 | 47.6 | 47.2 |
| 05:00 | JPY | Vehicle Sales (YoY) (OCT) | 0.2% | - | -3.0% |
| 05:30 | AUD | Commodity Index AUD (OCT) | 79.1 | - | 81.4 |
| 05:30 | AUD | Commodity Index (YoY) (OCT) | -19.8% | - | -21.3% |
European Session
| GMT | CCY | EVENT | EXP | PREV | IMPACT |
|---|---|---|---|---|---|
| 08:00 | CHF | Total Sight Deposits (OCT 30) | - | 467.0B | Low |
| 08:00 | CHF | Domestic Sight Deposits (OCT 30) | - | 401.2B | Low |
| 08:15 | CHF | Retail Sales Real (YoY) (SEP) | - | -0.3% | Low |
| 08:30 | CHF | PMI Manufacturing (OCT) | 50.1 | 49.5 | Medium |
| 08:45 | EUR | Markit/ADACI Italy Mfg PMI (OCT) | 53.1 | 52.7 | Low |
| 08:50 | EUR | Markit France Mfg PMI (OCT F) | 50.7 | 50.7 | Low |
| 08:55 | EUR | Markit/BME Germany Mfg PMI (OCT F) | 51.6 | 51.6 | Medium |
| 09:00 | EUR | Markit Eurozone Mfg PMI (OCT F) | 52.0 | 52.0 | Medium |
| 09:30 | GBP | Markit UK Mfg PMI SA (OCT) | 51.3 | 51.5 | High |
Critical Levels
| CCY | Supp 3 | Supp 2 | Supp 1 | Pivot Point | Res 1 | Res 2 | Res 3 |
|---|---|---|---|---|---|---|---|
| EURUSD | 1.0803 | 1.0909 | 1.0957 | 1.1015 | 1.1063 | 1.1121 | 1.1227 |
| GBPUSD | 1.5081 | 1.5241 | 1.5335 | 1.5401 | 1.5495 | 1.5561 | 1.5721 |
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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