• The NFP report is the key macroeconomic release today, wages in the limelight
  • The UK industrial data takes the stage this morning, GBP reacts to new developments in the Brexit talks
  • Preliminary UoM indicators will show if the US consumers still beam with optimism, inflation expectations should be also relevant for the USD

The NFP report is not only the key release on Friday, but it is also one of the most significant prints for the US dollar. Investors should chiefly focus on wages. In the morning the readings from the UK economy take the stage. We get data from industry sector and market participants have been digesting first outcomes of Brexit talks.

9:30 am BST – UK, manufacturing, industrial output, and trade balance for October. There is a quite bountiful package of data from the UK economy scheduled to release this morning. However, manufacturing and industrial production shouldn’t spur higher market reactions as this sector is relatively small compared to services and investors have been analysing announced progress in Brext talks – after the EU summit, which takes place next week, both sides could start negotiating a new trade deal. Manufacturing output is expected to contract by 0.1% m/m (prior: +0.7%), whilst industrial production is seen stagnating (prior: +0.7%). When it comes to trade balance, the street calls for a deficit of 11.45bn GBP (prior: -11.25bn GBP).

1:30 pm BST – US, the NFP report for November. The US dollar has appreciated recently, in part due to progress in the implementation of tax reform and approaching rate hike. While there are no inflation figures scheduled to be released this week, investors will focus on wage dynamics in the Friday’s report from the labour market as higher wage growth could fuel more inflation in the future. The nonfarm employment should grow by 200k, whilst wages are seen advancing to 2.7% y/y from 2.4%. 

3:00 pm BST – US, preliminary prints of UoM indicators. The latest data showed that the US consumers bowed with optimism and given ongoing Christmas holiday sales season it’s unlikely to see a deterioration of sentiment. Moreover, investors should look at inflation expectations.

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 GBPUSD is testing the key resistance. If the currency pair brakes above, bulls could aim at upper bound of the ascending channel and recent highs of 1.3660. Source: xStation5