Euro May Look Past German Data, US GDP Dip Unlikely to Derail Dollar

Date

10/30/2014 3:36:24 AM

(MENAFN- DailyFX) DailyFX.com - r>

" style="text-align:justify"> Talking Points:

Euro Unlikely to Find Lasting Cues in German Unemployment CPI Reports
US 3Q GDP Slowdown May Not Amount to Major Setback for the US Dollar
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German Unemployment and CPI reports headline the economic calendar in European hours. Jobless ranks are expected to shrink by 4000 in October keeping the unemployment rate unchanged at 6.7 percent. Separately the benchmark inflation rate is expected to edge higher to 0.9 percent after lingering at a four-year low of 0.8 percent through the third quarter.

On balance neither data release seems likely to produce a lasting response from the Euro considering the outcomes’ limited implications for near-term ECB monetary policy. The central bank is still in the implementation phase of a medley of stimulus efforts and will likely want to see how things progress for some time after everything is in place. That means additional easing probably won’t materialize until next year putting policy on auto-pilot in the interim.

Looking ahead third-quarter US GDP figures will enter the spotlight. An annualized increase of 3 percent is expected marking a slowdown from the 4.6 percent gain recorded in the three months through June. The latter number may have been exaggerated on a comparative basis by the weather-linked slump in the first three month of the year. With that in mind a pullback closer to but still above the post-crisis average (2.2 percent) may not prove to be a major setback for the US Dollar particularly after a seemingly confident FOMC opted against a dovish rhetoric shift at yesterday’s monetary policy announcement (as expected). We remain short EURUSD and long USDCHF.

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Asia Session

" style="text-align:center"> GMT	" style="text-align:center"> CCY	" style="text-align:center"> EVENT	" style="text-align:center"> ACT	" style="text-align:center"> EXP	" style="text-align:center"> PREV
" style="text-align:center"> 20:00	" style="text-align:center"> NZD	RBNZ Interest Rate Decision	" style="text-align:center"> 3.50%	" style="text-align:center"> 3.50%	" style="text-align:center"> 3.50%
" style="text-align:center"> 0:00	" style="text-align:center"> AUD	HIA New Home Sales (MoM) (SEP)	" style="text-align:center"> 0.0%	" style="text-align:center"> -	" style="text-align:center"> 3.3%
" style="text-align:center"> 0:30	" style="text-align:center"> AUD	Import Price Index (QoQ) (3Q)	" style="text-align:center"> -0.8%	" style="text-align:center"> 0.2%	" style="text-align:center"> -3.0%
" style="text-align:center"> 0:30	" style="text-align:center"> AUD	Export Price Index (QoQ) (3Q)	" style="text-align:center"> -3.9%	" style="text-align:center"> -4.7%	" style="text-align:center"> -7.9%
" style="text-align:center"> 2:00	" style="text-align:center"> JPY	Vehicle Production (YoY) (SEP)	" style="text-align:center"> -2.6%	" style="text-align:center"> -	" style="text-align:center"> -6.7%

European Session

" style="text-align:center"> GMT	" style="text-align:center"> CCY	" style="text-align:center"> EVENT	" style="text-align:center"> EXP	" style="text-align:center"> PREV	" style="text-align:center"> IMPACT
" style="text-align:center"> 7:00	" style="text-align:center"> GBP	Nationwide House Prices n.s.a. (YoY) (OCT)	" style="text-align:center"> 8.5%	" style="text-align:center"> 9.4%	" style="text-align:center"> Low
" style="text-align:center"> 7:00	" style="text-align:center"> GBP	Nationwide House Prices s.a. (MoM) (OCT)	" style="text-align:center"> 0.3%	" style="text-align:center"> -0.2%	" style="text-align:center"> Low
" style="text-align:center"> 7:00	" style="text-align:center"> CHF	UBS Consumption Indicator (SEP)	" style="text-align:center"> -	" style="text-align:center"> 1.35	" style="text-align:center"> Medium
" style="text-align:center"> 8:00	" style="text-align:center"> CHF	KOF Leading Indicator (OCT)	" style="text-align:center"> 99.2	" style="text-align:center"> 99.1	" style="text-align:center"> Medium
" style="text-align:center"> 8:55	" style="text-align:center"> EUR	German Unemployment Rate s.a. (OCT)	" style="text-align:center"> 6.7%	" style="text-align:center"> 6.7%	" style="text-align:center"> High
" style="text-align:center"> 8:55	" style="text-align:center"> EUR	German Unemployment Change (OCT)	" style="text-align:center"> 4K	" style="text-align:center"> 12K	" style="text-align:center"> High
" style="text-align:center"> 9:30	" style="text-align:center"> GBP	Lloyds Business Barometer (OCT)	" style="text-align:center"> -	" style="text-align:center"> 57	" style="text-align:center"> Low
" style="text-align:center"> 10:00	" style="text-align:center"> EUR	Eurozone Economic Confidence (OCT)	" style="text-align:center"> 99.7	" style="text-align:center"> 99.9	" style="text-align:center"> Low
" style="text-align:center"> 10:00	" style="text-align:center"> EUR	Eurozone Industrial Confidence (OCT)	" style="text-align:center"> -5.5	" style="text-align:center"> -5.5	" style="text-align:center"> Low
" style="text-align:center"> 10:00	" style="text-align:center"> EUR	Eurozone Business Climate Indicator (OCT)	" style="text-align:center"> 0.05	" style="text-align:center"> 0.07	" style="text-align:center"> Low
" style="text-align:center"> 10:00	" style="text-align:center"> EUR	Eurozone Consumer Confidence (OCT F)	" style="text-align:center"> -11.1	" style="text-align:center"> -11.1	" style="text-align:center"> Medium
" style="text-align:center"> 10:00	" style="text-align:center"> EUR	Eurozone Services Confidence (OCT)	" style="text-align:center"> 3.1	" style="text-align:center"> 3.2	" style="text-align:center"> Low
" style="text-align:center"> 13:00	" style="text-align:center"> EUR	German CPI (MoM) (OCT P)	" style="text-align:center"> -0.1%	" style="text-align:center"> 0.0%	" style="text-align:center"> High
" style="text-align:center"> 13:00	" style="text-align:center"> EUR	German CPI (YoY) (OCT P)	" style="text-align:center"> 0.9%	" style="text-align:center"> 0.8%	" style="text-align:center"> High
" style="text-align:center"> 13:00	" style="text-align:center"> EUR	German CPI – EU Harmonized (MoM) (OCT P)	" style="text-align:center"> -0.1%	" style="text-align:center"> 0.0%	" style="text-align:center"> High
" style="text-align:center"> 13:00	" style="text-align:center"> EUR	German CPI – EU Harmonized (YoY) (OCT P)	" style="text-align:center"> 0.9%	" style="text-align:center"> 0.8%	" style="text-align:center"> High

Critical Levels

" style="text-align:center"> CCY	" style="text-align:center"> Supp 3	" style="text-align:center"> Supp 2	" style="text-align:center"> Supp 1	" style="text-align:center"> Pivot Point	" style="text-align:center"> Res 1	" style="text-align:center"> Res 2	" style="text-align:center"> Res 3
" style="text-align:center"> EURUSD	" style="text-align:center"> 1.2398	" style="text-align:center"> 1.2538	" style="text-align:center"> 1.2585	" style="text-align:center"> 1.2678	" style="text-align:center"> 1.2725	" style="text-align:center"> 1.2818	" style="text-align:center"> 1.2958
" style="text-align:center"> GBPUSD	" style="text-align:center"> 1.5743	" style="text-align:center"> 1.5901	" style="text-align:center"> 1.5956	" style="text-align:center"> 1.6059	" style="text-align:center"> 1.6114	" style="text-align:center"> 1.6217	" style="text-align:center"> 1.6375

" style="text-align:justify"> --- Written by Ilya Spivak Currency Strategist for DailyFX.com

" style="text-align:justify"> To receive Ilya's analysis directly via email please SIGN UP HERE

" style="text-align:justify"> Contact and follow Ilya on Twitter: @IlyaSpivak

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