- Labor market reports will be released both from the US and Canadian economies
- Non-manufacturing ISM from the US worth keeping an eye as well
- UK services PMI could offer more insight into the economy after the BoE’s rate increase on Thursday
- A few central bank speakers to take the floor during the day
Two labor market reports from the US and the Canadian economies are going to end a tumultuous week in financial markets. Given the FED stuck to its view regarding an interest rate hike in December markets’ focus will turn to the labor market data as investors and policymakers seek some signs of rising wage pressure. On top of this, there will be a reading of non-manufacturing ISM which seems to be of note especially when it comes to the prices subindex.
9:30 am BST – UK services PMI: The Bank of England chose to hike interest rates at its November meeting as the broad consensus had pointed. However, along with a hike the bank sketched out quite the dovish outlook for future tightening suggesting that the main rate will rise just to 1% by 2020. As a result the GBP tumbled, hence today’s release could offer some reprieve for the currency. Notice that services PMI is by far the most important one in case of the UK, thus once the indicator came in much above the forecast it would help erase some yesterday’s losses. The consensus suggests 53.3 compared to 53.6 in September.
12:30 pm BST – Labor market reports from the US and Canada: Since the latest ECB meeting the US dollar has been doing well, however politics-related uncertainties (the new FED chair and a US tax bill) have weighed on the greenback of late therefore the EURUSD is slowly approaching a key resistance level which could be a decent place to re-sell the pair if the NFP beats the forecast. Bear in mind that we got the negative reading a month ago which was caused by the hurricanes, for that reason we expect that employment has bounced back substantially. The street’s call indicates 313k while the jobless rate is anticipated to stay at 4.2% whereas wage growth ought to come in at 2.7% yoy. Besides, we’ll know a report from the Canadian economy where the consensus suggests that employment has picked up 15k whilst the jobless rate should stay at 6.2%.
2:00 pm BST – US non-manufacturing ISM: The NFP report will be known first so non-manufacturing ISM will no offer any clues with regard to the jobs release. On the flip side, it’s worth tracking anyway as it should offer some signals pertaining to prices. Keep in mind that the prices subindex shoot up to 66.3 last month, hence yet higher levels appear to be hard to achieve. Either way, the headline is forecast to show 58.5.
Central bank speakers:
- 10:30 am BST – Norges Bank’s Olsen
- 10:30 am BST – ECB’s Nowotny
- 4:15 pm BST – FED’s Kashkari
- 8:15 pm BST – ECB’s Coeure