The US dollar is rising as the odds for a December Federal Reserve interest rate hike jumped to 94% (up from 75% earlier this week). The increased rate hike optimism comes as investors continue to anticipate higher Federal spending under a Republican Presidency and Congress. That said, US producer inflation growth missed expectations for October, which is holding back some of the greenback’s gains. Tomorrow will be heavy data wise, with October’s housing starts and building permits data, the weekly jobless claims, consumer inflation data, a Fed manufacturing survey for November, and a testimony from Federal Reserve Chair Janet Yellen.
Across the pond, sterling is down slightly against a rising US dollar on mixed labor market news. While UK unemployment dipped to 4.8% for the three months through September, jobless claims disappointingly rose to 9,800 workers for October, well above estimates of 2,000. Tomorrow morning’s retail sales results for October will finish out the week data wise for the UK.
The euro is trading slightly lower against a stronger greenback with no Eurozone data scheduled to come out today. Tomorrow morning will bring Italy’s September trade balance results followed by the broader Eurozone’s latest consumer inflation and construction output results.
Elsewhere, the Canadian dollar is up slightly as September’s manufacturing shipment results came in well above analyst expectations. The Australian dollar is falling as investors await tonight’s employment numbers for October, which will be the last data out of the country this week. The Japanese yen continues to weaken against the US dollar as investors are more attracted to the US’ relatively strong economy at the moment.
EURUSD: The euro is trading lower against a stronger US dollar with no new data out.
GBPUSD: The pound is slightly down as jobless claims rose more than expected in October.
AUDUSD: The Aussie dollar is down as investors await tonight’s employment data.
USDCAD: The Canadian dollar is up thanks to September’s stronger-than-expected manufacturing shipment results.