EUR consolidates around 1.0750 after tepid GDP data

Friday, November 13, 2015

European equities continue to remain under pressure extending losses in early trade on Friday, following the tepid GDP data. The German economy grew by 0.3% in Q3 2015, in line with expectations, while its y/y figure was reported at 1.7%, missing estimates of 1.8%. The French economy grew by 0.3% in Q3 2015, in line with estimates. This morning, the DAX, CAC, IBEX and London equity benchmark indices retreated between 0.30% and 0.65%, tracking losses in the Asian equity markets. The Hang Seng index gave back yesterday’s solid gains and reversed to retreat nearly 500 points (-2.15%) overnight. The Shanghai composite index extended declines after falling over 1.4% towards 3,580, while in Japan the Nikkei index slid lower by 100 points (-0.51%) below 19,600.

EUR consolidates around 1.0750

EURUSD Curncy (EUR-USD X-RATE)   2015-11-13 08-59-38

The main focus will turn to the release of the Eurozone’s trade balance and GDP data. The EUR continues to remain in choppy consolidation mode after hovering around 1.0750 against the USD. Today’s release of European GDP data has failed so far to provide any direction to the currency.

In the US, market participants will be keeping an eye on the release of the retail sales figures as well as Business inventories data in September, while market’s attention will also turn to the University of Michigan survey regarding the current economic conditions and prospects. The USD index continues its strong rally, after hovering just below 99.0 against a basket of currencies. Fed Vice Chairmain Stanley Fischer didn’t make any prediction of whether the Fed will raise rates in December at his recent speech in Asia but he pointed out the October FOMC meeting indicated that a possible interest rate rise in December ‘may be appropriate’.

Crude oil prices extended declines yesterday, following another large build of 4.22 million barrels in crude oil inventories. Crude oil stocks at the key location of Cushing, Oklahoma, surged by 2.23 million barrels, missing estimates and verifying persistent concerns over global supply glut. This morning, WTI front month futures have slightly rebounded towards $42 per barrel, in a correction higher. Please note that WTI futures have lost nearly $7 during the first two weeks in November, suggesting strong downside momentum in the oil market.   

WTI front month futures have declined nearly $7 so far in November

CLZ5 Comdty (WTI CRUDE FUTURE  D 2015-11-13 08-57-45

 

Events for today:

0700

DE

Q3

GDP

0930

UK

Sep

Construction Output

1000

EZ

Oct

Trade Balance

1000

EZ

Q3

GDP

1330

US

Oct

Retail Sales

1330

US

Oct

PPI Final Demand

1455

US

Nov

University of Michigan Survey

1500

US

Sep

Business Inventories

 

All times UK Local Time

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