- China’s GDP
- Oil’s impact
- Canadian elections
- Dovish Dudley
China released GDP figures for the third quarter this morning. Estimates of a 6.8% increase were exceeded slightly, with official figures at 6.9% growth. This is the slowest quarterly increase for China since 2009, although the slowdown seems to be a controlled one. Retail sales numbers were strong, and industrial output was just under expectations. Investors greeted these releases of Chinese economic data with optimism, giving Aussie dollar a boost. As the morning has continued, however, the Aussie has pared much of its gains.
The impact of continued low crude oil prices is being felt in more than just energy companies. Saudi Arabia reported a budget deficit for the first time since 2009. Iran’s Oil Minister is encouraging OPEC to cut production to boost prices. OPEC’s current policy is to keep output at the same levels as last year, low prices notwithstanding.
Canada is voting for their Prime Minister today. It is believed that Justin Trudeau, son of previous Prime Minister Pierre Trudeau, will be the next man up for Canada.
Fed officials continue to show disunity regarding rate hike expectations. William Dudley, President of the New York Fed, clearly stated that is is “still too early to think about raising interest rates.” The tone has certainly changed since earlier this year.
EURUSD is weakening today, as traders anticipate a big ECB meeting Thursday.
GBPUSD is getting a boost today, as Merrill Lynch is betting on an increase in Sterling. One analyst from that firm sees .69 EURGBP by March of 2016.
USDCAD is strengthening this morning, as crude oil is down almost 1.7% and elections are happening. One should keep an eye on Saudi Arabia; any change in output they announce would greatly affect the price of crude oil.
AUDUSD rose with China’s GDP announcement, but has since drifted down, around its midpoint for the day. Investor sentiment is volatile regarding China, as traders mull over China’s slowdown.