Market Drivers – US Session, Nov. 13

The US Consumer Price Index is the crucial report on Tuesday. The Australian Westpac Consumer Confidence Index and the National Australia Bank’s Business Survey are due during the Asian session. Later in the day, the Eurozone will release Q3 GDP and employment figures, the UK will report jobs data, and Switzerland will release wholesale inflation data.

The market is shifting focus onto the US inflation data that is expected to be released on Tuesday. October is predicted to see a 0.1% increase in the Consumer Price Index (CPI), with the annual rate dropping from 3.7% in September to 3.36% in October.

It is anticipated that the core annual rate will stay at 4.1%. The market would be further convinced that the Federal Reserve has completed raising interest rates if the figures match expectations.

Key Developments

For the second day in a row, the dollar declined, moving away from the 106.00 region and towards 105.60. Higher commodity prices and lower US Treasury yields contributed to the decline in the value of the US dollar. The yield on the 2-year fell to 5.02%, while the yield on the 10-year fell to 4.62%.

EUR/USD held above 1.0650 and climbed to 1.0700, showing sideways movement in the short-term. Eurostat is set to release employment and growth data from the third quarter, and the ZEW survey for November is also due. GBP/USD rose to 1.2280, while the USD/CHF reached weekly highs before retracing towards 0.9000. Switzerland’s wholesale inflation data is due on Tuesday, and Swiss National Bank Chairman Thomas Jordan is scheduled to deliver a speech. A

UD/USD rose after a five-day decline, finding support above 0.6330 and approaching 0.6400. Key reports of the week include employment figures on Thursday and the Q3 Wage Price Index on Wednesday. NZD/USD rebounded but could not reclaim 0.5900, and USD/CAD ended the day flat, hovering around 1.3800.

The Bank of Canada has suspended its rate hike cycle for the second time in September, keeping its key interest rate stable at 5%. The US is currently discussing another rate hike, which is supporting USD-CAD. It is expected that no further rate hikes will occur in the US, and the Canadian economy is expected to achieve a soft landing, with potential for CAD recovery next year.

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