News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Bearish
Gold
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Mixed
USD/JPY
Bullish
More View more
Real Time News
  • Could #APAC stocks (such as the #ASX200 and #HangSeng) follow the #DowJones lower on Tuesday after US fiscal stimulus bets faded? Check out today's APAC stocks briefing here - https://www.dailyfx.com/forex/market_alert/2020/10/20/Dow-Jones-Sinks-Hang-Seng-May-Follow-ASX-200-Could-Rise-on-Dovish-RBA.html?CHID=9&QPID=917702&utm_source=Twitter&utm_medium=Dubrovsky&utm_campaign=twr https://t.co/2Mn2x2lndw
  • Join @DanielGMoss's #Webinar at 10:00 PM ET/2:00 AM GMT for his weekly coverage of trading prep for $AUDUSD in the week ahead. Register here: https://t.co/wi1qabrtHJ https://t.co/pkiysDzFrD
  • RBA Minutes: Further easing would reduce financial stability risks -BBG $AUDUSD #RBA
  • RBA Minutes: Further easing would gain traction as the economy opens, members considered effect of lower rates on confidence and savers -BBG #RBA $AUDUSD
  • RBA Minutes: Fiscal, monetary support will be needed for some time. Agreed to place more weight on actual over forecast CPI -BBG #RBA $AUDUSD
  • Last week’s British Pound price reversal keeps the focus on a break of the recent range for guidance with the broader risk still lower below the yearly open. Get your $GBPUSD technical analysis from @MBForex here:https://t.co/znI4iT8skY https://t.co/QqGOzRwjmW
  • USD/JPY and GBP/JPY may reverse lower in the near-term as both exchange rates fail to breach key resistance. CAD/JPY rates eyeing a retest of its post-crisis high. Get your market update from @DanielGMoss here:https://t.co/NptWy89cTa https://t.co/PYrMMwaCXg
  • Both $AUDUSD and $NZDUSD are slipping in early Tuesday APAC trade following dovish remarks from the #RBA ... https://t.co/nvOjnM8z8h ...and #RBNZ respectively: https://t.co/tDlVxzO68h https://t.co/w3y9zDlz6i
  • RBA's Kent: Notes still room to compress short-term rates -BBG $AUDUSD #RBA
  • Read your daily election update⬇️ https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/asia_am_briefing/2020/10/19/AUDUSD-Downtrend-to-Accelerate-Election-Betting-Odds-Defying-Polls.html
FX Markets Turn to RBA, BOC, and US NFP in First Full Week of December

FX Markets Turn to RBA, BOC, and US NFP in First Full Week of December

2017-12-04 12:30:00
Christopher Vecchio, CFA, Senior Strategist
Share:

Talking Points:

- The first full week of a new month brings its usual trappings: central bank rate decisions, PMIs, and labor market data.

- It seems highly unlikely that the upcoming US jobs report can do anything to deter the Federal Reserve from hiking rates next week (100% probability according to Fed funds futures).

- Retail trader positioning is suggesting a more negative trading environment for the US Dollar.

Join me on Mondays at 7:30 EST/12:30 GMT for the FX Week Ahead webinar, where we discuss top event risk over the coming days and strategies for trading FX markets around the events listed below.

12/05 Tuesday | 03:30 GMT | AUD Reserve Bank of Australia Rate Decision

The Reserve Bank of Australia is expected to keep rates unchanged at 1.50% on Tuesday as the country’s growth outlook hasn’t evolved that much in recent weeks. The labor market continues to improve gradually, and it is expected that the unemployment rate will fall further in the coming years. However, with real wage growth continuing to struggle, Australian consumers face some challenges ahead. Accordingly, the RBA is unlikely to want, or need, to change its policy stance in the near future. Rates markets are not pricing in any shift in policy until December 2018 (93% chance of a rate hike; November 2018 hike odds are currently 48%).

Pairs to Watch: AUD/JPY, AUD/NZD, AUD/USD

12/05 Tuesday | 15:00 GMT | USD ISM Non-Manufacturing/Services Composite (NOV)

The November USD ISM Non-Manufacturing/Services headline reading is expected at 59 versus a prior reading of 60.1. The relatively similar headline reading expected this Wednesday is indicative of currently favorable business conditions that are easing off the strong burst in sentiment that has been so prevalent in US markets. The US Dollar should show heightened sensitivity to this report given the economy’s tendency to follow the performance of the service sector, which accounts for approximately two-thirds of jobs in the United States. Look for the data, in conjunction with the ADP Employment report, to shape expectations for Friday’s Nonfarm Payrolls report.

Pairs to Watch: EUR/USD, USD/JPY, DXY Index, Gold

12/06 Wednesday | 00:30 GMT | AUD Gross Domestic Product (3Q)

Australian growth concerns have lingered throughout 2017, and Q3’17 GDP data may go some ways to relieve some of the anxiety. Year-over-year growth rates are expected to rebound sharply, with the Bloomberg News consensus forecast looking for a +3.0% rate of growth, up from +1.8% in Q2’17 (y/y). The quarterly growth rate is expected to remain solid at +0.7% after +0.8% in Q2’17.Given how pessimistic market participants have been on the Australian Dollar in the second half of this year, underscored by rates markets not pricing in any policy change until December 2018, it would seem that there is asymmetric risk for a stronger reaction by the Australian Dollar: a soft GDP reading won’t do much to change rates markets pricing; but a strong GDP reading might.

Pairs to Watch: AUD/JPY, AUD/NZD, AUD/USD

12/06 Wednesday | 15:00 GMT | CAD Bank of Canada Rate Decision

The Canadian Dollar has had a volatile 2017, and much of it has to do with pricing around potential BOC policy decisions. In early-June, there was less than a 10% chance of a rate hike for the rest of 2017. By mid-July, not only had one rate hike actually been priced-in – and the BOC did hike – but a second hike was being priced-in for the end of the year. Eventually, this transpired in September with markets pricing a third hike in for 2017. This hawkish perception proved to be overdone, with the market-implied odds of a BOC hike this week now below 20%. Looking down the calendar, March 2018 comes in as the most likely period for the next rate hike (75% chance). As such, even if the BOC does not hike this week, expectations are high that they will continue to prep markets for further policy tightening in the months ahead.

Pairs to Watch: CAD/JPY, EUR/CAD, USD/CAD

12/08 Friday | 13:30 GMT | USD Change in Nonfarm Payrolls & Unemployment Rate (NOV)

The key issue surrounding the November US Nonfarm Payrolls report is whether or not the US labor market will remain strong enough to justify a more aggressive pace of Fed tightening in 2018. Current expectations for the data are modest, with the Unemployment Rate expected to hold at 4.1%, and the headline jobs figure to come in at +199K. The trend of +200K jobs growth per month has recently been a psychological level for markets, but Fed leaders and centrists (the Goldilocks of the Fed; not too hawkish or too dovish) tend have another number in mind.

In October 2015, San Fran Fed President John Williams wrote in a research note that he believed growth of +100K jobs per month was enough to sustain the growth in the labor force and maintain the current unemployment rate. In December 2015, Chair Janet Yellen reiterated this same view. And, in late-February 2016, she noted that the economy can maintain its current unemployment rate by producing between 75K and 125K jobs per month. According to the Atlanta Fed Jobs Growth Calculator, the economy only needs +110K jobs growth per month over the next 12-months in order to sustain said unemployment rate at its current 4.1% level.

Pairs to Watch: EUR/USD, USD/JPY, DXY Index, Gold

Read more: Euro Fundamentals Remain Strong, but Heavy Positioning a Clear Burden

--- Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher, email him at cvecchio@dailyfx.com.

Follow him in the DailyFX Real Time News feed and Twitter at @CVecchioFX.

To receive this analyst’s reports, sign up for his distribution list.

Don’t trade FX but want to learn more? Read the DailyFX Trading Guides.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES