Intraday Market Thoughts

Market Awaits Core PCE; Chicago PMI And CAD GDP

by Patrik Urban
Nov 30, 2012 12:53

Eurozone CPI falls; EZ unemployment rate at new record high; German retail sales decline. Focus turns to core PCE; personal income and spending; Chicago PMI and Canadian GDP. 1 of 2 EURUSD longs hit all targets, the other awaits final target at marginally higher level. Both GBPUSD longs are in progress. 2 Gold longs were stopped out. See the rest below.

The greenback strengthened at the beginning of the London session. However, most gains were lost after the bundestag approved the Greek aid bill. European equities trade in narrow ranges and JPY lags.

Comments from ECB's Draghi and IMF's Lagarde did not provide any surprises and only reiterated supporting views on banking union, the ECB's banking supervisory role and the role of the OMT. However, an interesting comment came from German finance minister Wolfang Schaeuble who suggested that Greek default must be avoided as it could lead to the end of the Eurozone.

European data disappointed today. Eurozone CPI eased to 2.2% in November which is the lowest level since January 2011 and the unemployment rate ticked higher to a new record 11.7% from 11.6%. The unemployment rate has risen 12th times in a row. German retail sales dropped 2.8% in October after rising 0.5% in September and finally Italian unemployment rate rose yet again and reached 11.1% from 10.8%.

The US session begins at 8:30 am ET with FED's preferred inflation measure, the core PCE that is expected to remain steady in October at 1.7% y/y. Personal income is seen growing 0.2% from 0.4% and personal spending is anticipated unchanged.

Chicago PMI will flash on screens at 9:45 am and it is seen at 50.7 after two monthly sector contractions. By the end of the session at 5:00 pm the FOMC member Jeremy Stein will participate in a discussion on large scale asset purchases. Any surprising comments could impact trading on Monday morning. CAD traders await September GDP that is expected to grow 0.1% from -0.1% m/m and remain steady at 1.2% y/y. The report is due at 8:30 am.

USDJPY, EURJPY, CADJPY are all in progress, while silver and oil were stopped out. For DIRECT ACCESS to these trades and the 3 volatility charts, click here: NonSubscribers Can click here to join:


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