It’s quite hard to make a clear assessment of yesterday’s FOMC statement, because even though the language of FED remains sufficiently hawkish, however, there was a lack of clear guidelines providing that December 2016 will be the date of the next interest rate hike. The evening publication brought more volatility in the markets, but the dollar is still weakening at the finish of the American president election campaign.
Hillary Clinton ratings are increasingly slipping from since FOX informations related to FBI investigation were published. Leaking of e-mails of candidate for President Clinton served the polls for Donald Trump. This in turn caused more uncertainty within investors who fear the unknown and are selling off dollar third day in a row:
At the weakness of the dollar also benefits the pound sterling. British currency is still before two extremely important events, the first of which will be the decision of the Supreme Court on Article 50. The judges will decide whether MPs consent is required to start procedures to leave the UK EU structures.
The second event is of course the Super Thursday. At noon we will follow the decision of the Bank of England on the level of UK interest rates. In addition, the report will be published simultaneously with report of BoE on the level of inflation in the UK. According to most analysts, the report’s forecasts may prove to be better than those published after the second quarter of this year and so the pound is gaining value:
What are we waiting for?
The most important event of the day is, of course, monetary decision of the Bank of England and the publication of the British inflation report. This does not mean that the rest of the day markets will be ruled only by sentiments.
At 9:30 AM (GMT) we will have a foretaste of the afternoon madness that is the publication of a British report PMI for services. The market expects that the October index value falls slightly to a lower level of 52.4 (compared to 52.6 in September).
At 10: AM Eurostat shares data on the unemployment rate in the euro area – projected value is equal to 10.0%.
About noon mentioned publications of Bank of England, and half an hour later scheduled a press conference of Mark Carney. Simultaneously published in the United States are popular claims – market consensus assumes no change compared to the previous week.
Fifteen minutes before 2:00 PM we will know the services PMI indicators and PMI by Markit. Fifteen minutes later, equally important publication of the ISM PMI for services. Value of the index in October is likely to fall to 56.0 from 57.1 in September.
