Weekly Market Review
November 17-23 , 2013
Last week outlook
The dollar slid to a one-week low against the euro on Friday and edged lower against the yen following the release of unexpectedly weak U.S. manufacturing data, one day after Federal Reserve Chairwoman nominee Janet Yellen defended the bank’s stimulus program.
The dollar eased back from two-month highs against the yen, with USD/JPY ending Friday’s session at 100.19 after rising as high as 100.42 earlier. For the week, the pair gained 1.04%, the third straight weekly gain.
EUR/USD ended Friday’s session at 1.3497, 0.29% higher for the day, extending the week’s gains to 0.66%.
Sterling was higher against the dollar on Friday, with GBP/USD settling at 1.6120, 0.35% higher for the day. For the week, the pair was up 0.84%.
The dollar slipped after a report showed that the Federal Reserve’s Empire state manufacturing index fell to -2.21 from 1.52 in October. Economists had forecast a rise to 5.0.
A separate report showed that U.S. industrial production fell 0.1% in October, after rising by 0.7% in September, compared to expectations for a 0.2% increase.
The data came a day after testimony from Federal Reserve Vice Chairwoman Janet Yellen was seen as cementing the view that the bank will keep its USD85 billion-a-month asset purchase program in place until early next year.
Ms. Yellen said it was "imperative" that the Fed does everything in its power to ensure a robust recovery. She said the quantitative easing program would not continue indefinitely but the timescale for reducing it would be data dependent.
The comments came during a Senate confirmation hearing to take over from Ben Bernanke as head of the central bank in February.
The euro’s gains were held in check after data on Thursday showed that the euro zone recovery slowed more than expected in the third quarter.
Euro zone gross domestic product expanded 0.1% in the three months to September, slowing from the 0.3% growth achieved in the second quarter when the euro zone exited a recession. Economist had forecast quarter-on-quarter growth of 0.2%.
Elsewhere, the euro ended the week 1.71% higher against the broadly weaker yen, with EUR/JPY settling at 135.22, up from 134.58 on Thursday.
The yen remained under pressure after Japanese Finance Minister Taro Aso said Thursday it is important to retain currency market intervention as a policy option to utilize in time of excess volatility in markets.
In the week ahead, investors will be closely watching Wednesday’s minutes of the Fed’s most recent policy setting meeting. The U.S. is also to release data on retail sales and consumer prices.
The euro zone is to release data on manufacturing and services sector activity and the ZEW Institute is to release its report on German economic sentiment. Meanwhile, China is to produce preliminary data on manufacturing activity.
Bloombex-Options.com has compiled a list of significant events likely to affect the markets.
Monday, November 18The euro zone is to release data on the current account balance.
Canada is to publish a report on foreign securities purchases.
The U.S. is to release private sector data on the outlook for the housing sector.
Tuesday, November 19The Reserve Bank of Australia is to publish its monetary policy meeting minutes, which contain valuable insights into economic conditions from the bank’s perspective. Australia is also to publish an index of leading economic indicators.
The ZEW Institute is to release its closely watched report on German economic sentiment, a leading indicator of economic health.
The U.S. is to release data on the employment cost index, an important inflationary indicator.
Later Tuesday, New Zealand is to publish data on producer price inflation input.
Wednesday, November 20Japan is to release data on the trade balance, the difference in value between imports and exports.
In the euro zone, Germany is to release data on producer price inflation.
The Bank of England is to publish the minutes of its most recent policy setting meeting.
The ZEW Institute is to publish a report on economic expectations in Switzerland, a leading indicator of economic health.
Canada is to produce data on wholesale sales, a leading indicator of consumer spending.
The U.S. is to release a series of data including a report on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity. The nation is also to publish data on consumer inflation, existing home sales and business inventories.
Later Wednesday, the Federal Reserve is to publish what will be the closely watched minutes of its latest policy meeting.
Thursday, November 21China is to release the preliminary estimate of the HSBC manufacturing index, a leading indicator of economic health.
The Bank of Japan is to announce its benchmark interest rate and publish its monetary policy statement, which outlines economic conditions and the factors affecting the bank’s decision. The announcement is to be followed by a press conference.
The euro zone is to release preliminary data on manufacturing and service sector activity, a leading indicator of economic health. Germany and France are also to release individual reports.
The U.K. is to release data on public sector net borrowing.
The U.S. is release data on producer price inflation, as well as the weekly report on initial jobless claims. The U.S. is also to release data manufacturing activity from the Philly Fed.
Friday, November 22The Ifo Institute is to publish a report on German business climate, a leading indicator of economic health.
Canada is to round up the week with reports on retail sales and consumer inflation.
Monday the 18th
• 8:30 GMT CHF, SVME PMI.
• 9:30 GMT GBP, Manufacturing PMI.
Tuesday the 19th
• 12:01 GMT BRC, Retail sales monitor.• 5:30 GMT AUD, RBA Rate statement.
• 6:45 GMT CHF, GDP.
• 9:30 GMT GBP, Construction PMI.
• 15:00 GMT USD, ISM Manufacturing PMI.
Wednesday the 20th
• 4-7th GMT GBP, Hakifax HPI.
• 09:30 GMT GBP, Services PMI
• 10:00 GMT EUR, Retail sales.
• 15:00 GMT CAD, BOC Rate statement.• 19:00 GMT USD Beige book
Thursday the 21th
• 02:30 GMT AUD, Trade balance .
• 03:30 GMT JPY, Monetary base statement.
• 12:00 GMT GBP, Asset purchase facility.• 12:00 GMT GBP, Offical bank rate.
• 12:45 GMT EUR, Minimum bid rate.
• 13:15 GMT USD, ADP Non-farm employment change.
. 13:30 GMT EUR ECB press conference.
. 13:30 GMT USD Unemployment Claims.
• 16:00 GMT USD, Crude oil inventories.
Friday the 22th
• 09:30 GMT GBP, Manufacturing production.
• 13:30 GMT CAD, Enployment change
• 13:30 GMT USD, Non-Farm employment change.
• 13:30 GMT USD, Unemployment rate.
• 15:00 GMT USD, Niesr GDP Estimate.
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