The Euro may fall as another rise in German unemployment stokes ECB rate cut expectations. The Yen rose as the BOJ proved modest in expanding stimulus.
Talking Points
- Euro May Fall as German Unemployment Gain Boosts ECB Rate Cut Bets
- Japanese Yen Higher in Asia as BOJ Stimulus Boost Meets Expectations
German Unemployment figures headline the economic calendar in European hours. Expectations call for the economy to shed 10,000 jobs in October, pushing the unemployment rate higher to 6.9 percent. Job losses have been steadily mounting in the Eurozone’s largest economy, with the ranks of the unemployed rising for six consecutive months for a cumulative 54,000 increase over the second and third quarters. Another push the same direction may reinforce signs of deepening weakness seen in last week’s dismal PMI readings, stoking ECB rate cut expectations and weighing on the Euro.
The Japanese Yen outperformed in overnight trade after the Bank of Japan announced an expansion of stimulus measures that fell on the low end of forex traders’ expectations. Policymakers expanded asset purchases by ¥11 trillion. Reports circling the wires before the announcement called for as much as a ¥20 trillion expansion. The currency’s gains may prove fleeting however considering the BOJ also forecast that inflation would come in below its 1 percent target through the 2014 fiscal year, meaning additional efforts to loosen monetary policy are likely on the horizon.
Asia Session: What Happened
|
GMT |
CCY |
EVENT |
ACT |
EXP |
PREV |
|
23:30 |
JPY |
Jobless Rate (SEP) |
4.2% |
4.2% |
4.2% |
|
23:30 |
JPY |
Job-To-Applicant Ratio (SEP) |
0.81 |
0.83 |
0.83 |
|
23:30 |
JPY |
Household Spending (YoY) (SEP) |
-0.9% |
0.80% |
1.8% |
|
23:50 |
JPY |
Industrial Production (YoY) (SEP P) |
-8.1% |
-7.1% |
-4.6% |
|
23:50 |
JPY |
Industrial Production (MoM) (SEP P) |
-4.1% |
-3.1% |
-1.6% |
|
0:00 |
HIA New Home Sales (MoM) (SEP) |
-3.7% |
- |
-5.3% |
|
|
4:00 |
JPY |
Vehicle Production (YoY) (SEP) |
-12.4% |
- |
4.5% |
|
5:49 |
JPY |
Bank of Japan Rate Decision |
0.10% |
0.10% |
0.10% |
Euro Session: What to Expect
|
GMT |
CCY |
EVENT |
EXP/ACT |
PREV |
IMPACT |
|
7:00 |
UBS Consumption Indicator (SEP) |
1.07 (A) |
1.02 |
Low |
|
|
8:00 |
EUR |
Spain GDP (QoQ) |
-0.4% |
-0.4% |
Medium |
|
8:00 |
EUR |
Spain GDP (YoY) |
-1.7% |
-1.3% |
Medium |
|
8:00 |
EUR |
ECB President Draghi Speaks in Frankfurt |
- |
- |
Medium |
|
8:55 |
EUR |
German Unemployment Rate (OCT) |
6.9% |
6.8% |
High |
|
8:55 |
EUR |
German Unemployment Change (OCT) |
10K |
9K |
High |
|
10:00 |
EUR |
Euro-Zone Business Climate Indicator (OCT) |
-1.42 |
-1.34 |
Low |
|
10:00 |
EUR |
Euro-Zone Consumer Confidence (OCT F) |
-25.6 |
-25.6 |
Medium |
|
10:00 |
EUR |
Euro-Zone Services Confidence (OCT) |
-13 |
-12 |
Low |
|
10:00 |
EUR |
Euro-Zone Economic Confidence (OCT) |
84.5 |
85 |
Low |
|
10:00 |
EUR |
Euro-Zone Industrial Confidence (OCT) |
-17 |
-16.1 |
Low |
|
10:00 |
EUR |
Italy to Sell €7B in 5- and 10-year Bonds |
- |
- |
Medium |
|
11:00 |
CBI Reported Sales (OCT) |
8 |
6 |
Low |
Critical Levels
|
CCY |
SUPPORT |
RESISTANCE |
|
1.2869 |
1.3005 |
|
|
1.5985 |
1.6103 |
--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com
To contact Ilya, e-mail ispivak@dailyfx.com. Follow Ilya on Twitter at @IlyaSpivak
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