Hooray for the Greenback! Thanks to another run of risk aversion, the U.S. dollar was able to bag gains against its major counterparts yesterday. EUR/USD ended 19 pips below the 1.3000 major psychological level while USD/JPY closed 5 pips up from its 77.99 open price. Will we see another safe-haven rally today?
There were hardly any hard-hitting reports on yesterday’s schedule, which meant that traders focused most of their attention back on the euro zone debt situation. From what I gathered from reading Forex Gump’s article on the possibility of EUR/USD breaking its yearly lows, there are still plenty of financial threats in the region and it doesn’t help that their leaders can’t seem to come up with a strong solution.
The U.S. is set to release a bunch of economic reports, namely its PPI, weekly jobless claims figure, current account balance, TIC long-term purchases data, industrial production, Empire State manufacturing index and Philly Fed index today. Whew! That’s a lot of top-tier reports so make sure you stay on your toes for those releases starting 1:30 pm GMT.
Producer price levels are expected to be up by 0.3% in November after slipping by 0.3% during the previous month. The core version of the report, which excludes food and energy prices, could show a 0.2% uptick for November after staying flat in October.
Weekly jobless claims are estimated to come in at 389K for last week, a tad higher than the 381K figure for the other week. A higher than expected figure would mean that there were more people who filed for jobless claims for the first time, which could be negative for the U.S. labor market.
The current account balance could show that the deficit narrowed from 118 billion USD to 108 billion USD in the third quarter. Both manufacturing indices due today are expected to post improvements, with the Empire State index projected to climb from 0.6 to 3.1 and the Philly Fed index expected to rise from 3.6 to 5.1. If the actual figures come in better than consensus, it would reflect that the U.S. manufacturing industry’s expansion is stronger than expected.