Economic Data Puts the EUR in Focus, with the BoE and the GBP also in the Spotlight

Earlier in the Day:

It was a relatively busy start to the day on the economic calendar this morning. The Aussie Dollar and the Japanese Yen were in action early in the Asian session.

On the monetary policy front, the Asian markets also responded the FED’s overnight monetary policy decision and press conference.

For the Aussie Dollar

Australia’s trade surplus narrowed from A$15.077bn to A$12.243bn, versus a forecasted narrowing to A$12.200bn.

According to the ABS,

• Goods and services exports fell A$3,081m (6%) to A$44,969m, with the decline attributed to falling iron ore prices.
• Imports of goods and services declined A$586m (2%) to A$32,725m driven by continued global supply chain constraints.

The Aussie Dollar moved from $0.74621 to $0.74609 upon release of the figures. At the time of writing, the Aussie Dollar was up by 0.17% to $0.7461.

For the Japanese Yen

In October, Japan’s services PMI increased from 47.8 to 50.7, which in line with prelim figures.

According to the finalized Markit Survey,

• Japan’s services sector returned to expansion for the first time since January 2020.
• Employment levels increased for a 3^rd consecutive month.
• Business confidence reached its highest level since March 2013.
• Easing COVID-19 restrictions as a result of falling infections supported a pickup in sector activity.
• New orders fell for a 21^st consecutive month, however, albeit modestly and at the softest pace since April.

The Japanese Yen moved from ¥114.060 to ¥114.100 upon release of the figures. At the time of writing, the Japanese Yen was down by 0.12% to ¥114.150 against the U.S Dollar.

Elsewhere

At the time of writing, the Kiwi Dollar was up by 0.11% to $0.7168.

The Day Ahead

For the EUR

It’s a busy day ahead on the economic calendar. German factory orders and service sector PMIs for Italy and Spain will be in focus.

Finalized services and composite PMIs for France, Germany, and for the Eurozone are also due out.

Barring marked revisions from prelims, expect German factory orders and the Eurozone’s services and composite PMI to be key.

At the time of writing, the EUR was down by 0.02% to $1.1610.

For the Pound

It’s a relatively quiet day ahead on the economic calendar. Construction PMI numbers for October will be in focus ahead of the BoE monetary policy decision.

With the BoE having talked of the need to raise rates to combat inflation, the number of votes in favor of a hike and forward guidance will be key.

At the time of writing, the Pound was down by 0.04% to $1.3681.

Across the Pond

It’s a quieter day ahead on the economic calendar, with the weekly jobless claims figures in focus.

Trade data and unit labor costs and labor productivity numbers are also due out but should have a muted impact on the day.

Expect any FOMC member chatter to also influence, however.

At the time of writing, the U.S Dollar Spot Index was up by 0.01% to 93.869.

For the Loonie

It’s a relatively quiet day ahead. Trade data for September will be in focus later in the day.

With little else for the markets to consider, we can expect Loonie sensitivity to the numbers. The markets are expecting the Bank of Canada to begin lifting interest rates. Economic data will need to stack up, however…

At the time of writing, the Loonie was down by 0.02% to C$1.2393 against the U.S Dollar.

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