CORE/CPI Flash Estimate EUR: The euro zone is likely to experience a second double-digit inflation in November, according to analysts’ forecasts ahead of the release of key figures by European Central Bank officials. While the overall pace of consumer price inflation may have slowed for the first time in a year and a half, it remains above 10%. The average of 32 estimates in a Bloomberg survey predicts 10.4 percent. Officials have warned that an unexpected hike could force them to make a third consecutive 75-basis rate hike, while signs of easing could help build consensus toward a smaller step.
ADP Non-Farm Employment Change USD: Traders often consider employment figures from ADP, America’s largest payrolls provider, report as the harbinger of the Bureau of Labor Statistics release on Nonfarm Payrolls because of the correlation between the two. The overlaying of both series is quite high, but on individual months, the discrepancy can be substantial. Another reason FX traders follow this report is the same as with the NFP – a persistent vigorous growth in employment figures increases inflationary pressures, and with it, the likelihood that the Fed will raise interest rates. Actual figures beating consensus tend to be USD bullish.
Prelim GDP USD: The US Bureau of Economic Analysis (BEA) releases the Gross Domestic Product (GDP) growth on an annualized basis for each quarter. After publishing the first estimate, the BEA revises the data two more times, with the third release representing the final reading. Usually, the first estimate is the main market mover and a positive surprise is seen as a USD-positive development while a disappointing print is likely to weigh on the greenback.
JOLTS Job Openings USD: It’s released late, but can impact the market because job openings are a leading indicator of overall employment. If this index is lower than the expectations, it can strengthen the speculations for the drop of the employment index on Friday, and this means increasing the pressure on the dollar.
Pending Home Sales USD: The Pending Home Sales released by the National Association of Realtors is a leading indicator of trends of the housing market in the US It captures residential housing contract activity of existing single-family homes. As the housing market is considered as a sensitive factor to the US economy, it generates some volatility for the USD. Generally speaking, a high reading is seen as positive for the USD, while a low reading is seen as negative.
Fed Chair Powell Speaks USD: As head of the central bank, which controls short-term interest rates, Powell has more influence on the value of the nation’s currency than anyone else. His words are important for traders. If he mentions the end of inflation and the reduction of interest rate expectations, it can have a negative impact on the dollar, and if he continues to consider inflation stable, we will expect the dollar to strengthen.
