USD

[Moderator]

5 key Economic Events to watch this week Oct 26-30

In the week ahead, investors will be focusing on Wednesday’s monetary policy announcement by the Federal Reserve for fresh indications on the timing of an initial rate hike.

1. FOMC rate decision

The Federal Reserve is to announce its latest monetary policy decision at the conclusion of its two day meeting at 2:00PM Eastern Time on Wednesday, as investors look for any clear signal about a possible timeline for hiking interest rates.
Investors have been trying to gauge when the Fed will raise interest rates for the first time in nearly a decade after recent economic reports offered a mixed picture of the U.S. economy.

2. BoJ policy announcement

The Bank of Japan's latest monetary policy announcement is due during Asian morning hours on Friday. The BoJ is widely expected to keep policy steady despite recent chatter that it could expand the size of its monthly bond-buying program.
However, policymakers are likely cut their growth and inflation outlook for this fiscal year due to weak exports and falling oil prices.

3. U.S. third quarter growth data

The U.S. is to release figures on third quarter economic growth at 8:30AM Thursday. The data is expected to show that the economy expanded 1.6% in the three months ended September 30, slowing from growth of 3.9% in the second quarter, as a weaker global economy took its toll.

4. U.K. Q3 GDP

The Office for National Statistics is to produce data on U.K. economic growth for the third quarter at 9:30AM London Time on Tuesday, or 5:30AM ET. The report is forecast to reveal the economy grew 0.6% in the third quarter, after expanding 0.7% in the preceding quarter.

5. German IFO business sentiment data

The Ifo German research institute is to report on German business sentiment on Monday, with market players expecting the index to fall slightly to 107.8 this month from 108.5 in September.




--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Mirza
PCM Brokers

[mirza ally]

Dollar trims against major currencies

The dollar trimmed losses against the other major currencies in quiet trade on Monday, as investors eyed the release of U.S. housing sector data later in the day.

The dollar was lower against the yen, with USD/JPY sliding 0.42% to 120.96, after rising to two-month highs of 121.47 late Friday.

The dollar rallied late last week after European Central Bank President Mario Draghi signaled that further monetary easing is likely later this year.

The comments underlined the diverging monetary policy stance between the Federal Reserve and other central banks. The Fed is currently expected to start hiking interest rates sometime in early 2016.

On Friday, the People’s Bank of China unexpectedly cut interest rates in an effort to shore up slowing growth in the world’s second largest economy.

It was the sixth rate cut since last November, reinforcing the divergence in monetary policy between the U.S. and central banks in the rest of the world.

Investors were looking ahead to Wednesday’s monetary policy announcement by the Fed for fresh indications on the timing of an initial rate hike.

EUR/USD eased 0.09% to trade at 1.1007, not far from Friday’s lows of 1.0995, the weakest since August 11.

Earlier Monday, data showed that the IFO’s business climate index for Germany fell to 108.2 from 108.5 in September, but was better than expectations for a reading of 107.8.

Elsewhere, the dollar was lower against the pound, with GBP/USD up 0.12% at 1.5341 but higher against the Swiss franc, with USD/CHF climbing 0.53% to 0.9836.

The Australian and New Zealand dollars were stronger, with AUD/USD gaining 0.37% to 0.7253 and with NZD/USD rising 0.39% to 0.6777.

Meanwhile, USD/CAD edged down 0.14% to trade at 1.3149.





----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Mirza
PCM Brokers

[ashif]

Policy Divergence Boosts Dollar


Earlier, the US Dollar had remained close to a 2½ month peak versus the common currency Euro as FX traders reconsider the likelihood of a 2015 rate hike from the Fed. At the same time, the seeming divergence in monetary policies between the Fed and the European Central Bank is likely to weigh on the Euro for the long term. The ECB recently signaled that it would add more liquidity to the Eurozone’s money supply with additional asset purchases before the end of this year. Both GDP growth and inflation have continued to deteriorate in the Eurozone, even despite what the extraordinary efforts of Mario Draghi and the ECB.

[ashif]

Today’s important data and events…

· India to announce fiscal deficit for September at 9:30 GMT. RBI will declare forex reserve around 11:30 GMT.



· Inflation data to be released at 10:00 GMT. Producer price inflation to be released at 11:00 GMT.



· Greece will announce retail sales for August and Producer price index for September at 10:00 GMT.



· Euro Zone - Consumer inflation and unemployment rate to be released at 10:00 GMT.



· UK - Consumer credit and net lending to individuals to be released at 9:30 GMT along with M4 money supply. Conference board trade survey to be released at 11:00 GMT.



· Euro zone - Euro zone confidence data to be released at 10:00 GMT.



· Portugal - Portugal will release business and consumer confidence for October today.



· US - US will release personal income and spending data for September at 12:30 GMT, followed by Chicago PMI at 13:45 GMT and Michigan consumer sentiment at 14:00 GMT.



· Canada - Canada will announce monthly GDP at 12:30 GMT.

[ashif]

5 Dollar Drivers
The US dollar is looking stronger across the board and it seems that it has appetite for more. EUR/USD is getting closer to a critical low, the stubborn USD/JPY broke out of range and other currencies suffered losses as well.
1. Yellen talks about December: No. 1 at the FED said that December is a “live meeting” and that the FOMC thought it could be appropriate to move in December, even though no decision has been made yet. . And she had other upbeat comments to add in front of politicians in Washington: labor slack is diminishing significantly and that “employment is going up” in general.
2. Fischer sees inflation close to target: No. 2 at the FED said that we are not that far from a two percent inflation target once the oil stops rising and the dollar stops strengthening. This is contrary to the consensus that inflation is very far from target. In addition, inflation expectations have remained steady. He was also not worried about US deficits, which are “respectable” in comparison to GDP.
3. Dudley repeats live meeting: No. 3 at the central bank, NY Fed President Bill Dudley agreed with Yellen that December is a live. While he did say that there is slacker in the job market that the unemployment suggests (a known line from the Fed) he doesn’t seem to have the same doubts he had in August, when he mentioned that he was waiting for “more compelling evidence” for a rate hike.
4. Strong ISM Non-Manufacturing PMI: Contrary to the weak manufacturing sector (which showed loss), the measure for the largest US sector, services, was upbeat: the headline and the employment component showed strong activity, raising expectations for a rate hike. In addition, the report lifted Q4 growth expectations, with the Atlanta Fed GDP Now figure rising from 1.9% to 2.3%.
5. OK ADP NFP: After too many disappointing figures, ADP’s report for the private sector came out at +182K, as expected. Nothing earth shattering if you look at pace in the past year, but certainly above the previous two reports.

[ashif]

5 Dollar Drivers
The US dollar is looking stronger across the board and it seems that it has appetite for more. EUR/USD is getting closer to a critical low, the stubborn USD/JPY broke out of range and other currencies suffered losses as well.
1. Yellen talks about December: No. 1 at the FED said that December is a “live meeting” and that the FOMC thought it could be appropriate to move in December, even though no decision has been made yet. . And she had other upbeat comments to add in front of politicians in Washington: labor slack is diminishing significantly and that “employment is going up” in general.
2. Fischer sees inflation close to target: No. 2 at the FED said that we are not that far from a two percent inflation target once the oil stops rising and the dollar stops strengthening. This is contrary to the consensus that inflation is very far from target. In addition, inflation expectations have remained steady. He was also not worried about US deficits, which are “respectable” in comparison to GDP.
3. Dudley repeats live meeting: No. 3 at the central bank, NY Fed President Bill Dudley agreed with Yellen that December is a live. While he did say that there is slacker in the job market that the unemployment suggests (a known line from the Fed) he doesn’t seem to have the same doubts he had in August, when he mentioned that he was waiting for “more compelling evidence” for a rate hike.
4. Strong ISM Non-Manufacturing PMI: Contrary to the weak manufacturing sector (which showed loss), the measure for the largest US sector, services, was upbeat: the headline and the employment component showed strong activity, raising expectations for a rate hike. In addition, the report lifted Q4 growth expectations, with the Atlanta Fed GDP Now figure rising from 1.9% to 2.3%.
5. OK ADP NFP: After too many disappointing figures, ADP’s report for the private sector came out at +182K, as expected. Nothing earth shattering if you look at pace in the past year, but certainly above the previous two reports.

[ashif]

5 Dollar Drivers
The US dollar is looking stronger across the board and it seems that it has appetite for more. EUR/USD is getting closer to a critical low, the stubborn USD/JPY broke out of range and other currencies suffered losses as well.
1. Yellen talks about December: No. 1 at the FED said that December is a “live meeting” and that the FOMC thought it could be appropriate to move in December, even though no decision has been made yet. . And she had other upbeat comments to add in front of politicians in Washington: labor slack is diminishing significantly and that “employment is going up” in general.
2. Fischer sees inflation close to target: No. 2 at the FED said that we are not that far from a two percent inflation target once the oil stops rising and the dollar stops strengthening. This is contrary to the consensus that inflation is very far from target. In addition, inflation expectations have remained steady. He was also not worried about US deficits, which are “respectable” in comparison to GDP.
3. Dudley repeats live meeting: No. 3 at the central bank, NY Fed President Bill Dudley agreed with Yellen that December is a live. While he did say that there is slacker in the job market that the unemployment suggests (a known line from the Fed) he doesn’t seem to have the same doubts he had in August, when he mentioned that he was waiting for “more compelling evidence” for a rate hike.
4. Strong ISM Non-Manufacturing PMI: Contrary to the weak manufacturing sector (which showed loss), the measure for the largest US sector, services, was upbeat: the headline and the employment component showed strong activity, raising expectations for a rate hike. In addition, the report lifted Q4 growth expectations, with the Atlanta Fed GDP Now figure rising from 1.9% to 2.3%.
5. OK ADP NFP: After too many disappointing figures, ADP’s report for the private sector came out at +182K, as expected. Nothing earth shattering if you look at pace in the past year, but certainly above the previous two reports.

[ashif]

5 Dollar Drivers
The US dollar is looking stronger across the board and it seems that it has appetite for more. EUR/USD is getting closer to a critical low, the stubborn USD/JPY broke out of range and other currencies suffered losses as well.
1. Yellen talks about December: No. 1 at the FED said that December is a “live meeting” and that the FOMC thought it could be appropriate to move in December, even though no decision has been made yet. . And she had other upbeat comments to add in front of politicians in Washington: labor slack is diminishing significantly and that “employment is going up” in general.
2. Fischer sees inflation close to target: No. 2 at the FED said that we are not that far from a two percent inflation target once the oil stops rising and the dollar stops strengthening. This is contrary to the consensus that inflation is very far from target. In addition, inflation expectations have remained steady. He was also not worried about US deficits, which are “respectable” in comparison to GDP.
3. Dudley repeats live meeting: No. 3 at the central bank, NY Fed President Bill Dudley agreed with Yellen that December is a live. While he did say that there is slacker in the job market that the unemployment suggests (a known line from the Fed) he doesn’t seem to have the same doubts he had in August, when he mentioned that he was waiting for “more compelling evidence” for a rate hike.
4. Strong ISM Non-Manufacturing PMI: Contrary to the weak manufacturing sector (which showed loss), the measure for the largest US sector, services, was upbeat: the headline and the employment component showed strong activity, raising expectations for a rate hike. In addition, the report lifted Q4 growth expectations, with the Atlanta Fed GDP Now figure rising from 1.9% to 2.3%.
5. OK ADP NFP: After too many disappointing figures, ADP’s report for the private sector came out at +182K, as expected. Nothing earth shattering if you look at pace in the past year, but certainly above the previous two reports.

[mirza ally]

Dollar remains on peak for 3 months U.S job data in loop.

The dollar remained near three-month highs against the other major currencies on Thursday, as hopes for a December rate hike in the U.S. continued to support the greenback and investors awaited the release of U.S. jobs data on Friday.

The dollar was steady against the yen, with USD/JPY at 121.56.

The U.S. Department of Labor reported on Thursday that the number of individuals filing for initial jobless benefits in the week ending October 31 increased by 16,000 to 276,000 from the previous week’s total of 260,000. Analysts had expected jobless claims to rise by 2,000 to 262,000.

But the greenback remained supported after Federal Reserve Chair Janet Yellen said on Wednesday that a December rate hike is a "live possibility," depending on the data.

Investors were turning their attention to Friday's U.S. nonfarm payrolls report for further indications on the strength of the job market.

EUR/USD was also little changed at 1.0866.

Earlier Thursday, official data showed that German factory orders dropped 1.7% in September, confounding expectations for an increase of 1.0%, after a 1.8% decline the previous month.

Elsewhere, the dollar was higher against the pound and the Swiss franc, with GBP/USD down 0.88% at 1.5250 and with USD/CHF rising 0.31% to 0.9962.

Sterling came under pressure after the Bank of England left rates unchanged and cut its forecasts for growth and inflation in 2015 and 2016, indicating that interest rates are likely to remain on hold for longer.

The Australian dollar was steady, with AUD/USD at 0.7142, while NZD/USD gained 0.39% to 0.6619.

Meanwhile, USD/CAD edged up 0.27% to trade at 1.3183.



-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Mirza
PCM Brokers

[mirza ally]

Dollar holds gains vs other currencies on U.S data

The dollar held gains against the other major currencies on Monday, despite the release of downbeat manufacturing activity data from New York, as growing expectations for a December rate hike by the Federal Reserve continued to support the greenback.

EUR/USD slid 0.32% to six-month lows of 1.0740.

The Federal Reserve Bank of New York reported that its general business conditions index improved to -10.7 this month from a reading of -11.4 in October. Analysts had expected the index to rise to -6.0 in November.

The single currency was already under pressure from heightened expectations that the European Central Bank will enlarge its stimulus program, aimed at boosting price growth in the euro area, before the years end.

ECB President Mario Draghi was to speak at an event in Madrid later in the day.

The greenback remained broadly supported after Fed Vice-Chair Stanly Fischer said Thursday that it "may be appropriate" for the Fed to begin rising rates next month.

USD/JPY rose 0.29% to 122.96.

The yen showed little reaction after data showing that Japan’s economy contracted at an annual rate of 0.8% in the three months to September, after a 1.2% contraction in the previous quarter, putting the country into a technical recession.

The weak data added to pressure on the Bank of Japan to step up monetary easing measures to shore up growth.

Elsewhere, the dollar was higher against the pound, with GBP/USD shedding 0.25% to 1.5200 and was steady against the Swiss franc, with USD/CHF at 1.0059.

The Australian and New Zealand dollars were weaker, with AUD/USD down 0.48% at 0.7096 and with NZD/USD retreating 0.89% to 0.6482.

Meanwhile, USD/CAD edged up 0.11% to trade at 1.3335 after data showed that Canada's manufacturing sales declined by 1.5% in September, compared to expectations for a 0.1% uptick. Manufacturing sales slipped 0.6% in August, whose figure was revised from a previously estimated 0.2% dip.




--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Mirza
PCM Brokers DMCC
Executive Co ordinator