Talking Points
Most major currencies were little changed against theUS Dollar in overnight trade despite a strong rally across Asian stock exchanges, where shares soared over 1 percent on average on news thatGreece andItalyare making progress toward installing new governments committed to addressing the countries’ debt woes.
In Athens, the nascent administration of Lucas Papademos – a former Vice President of the ECB – pledged to implement the terms of his country’s bailout, paving the way for disbursement of aid funds. Meanwhile in Rome, the lower house of Parliamentpassed a round of austerity measures that cleared the way for the resignation of Silvio Berlusconi, with PresidentGiorgio Napolitano tapping former EU Commissioner Mario Monti to form a new government, as expected.
On balance, the announcements mirrored what investors had expected heading into the weekend, suggesting the advance across Asian bourses was a catch-up move to those seen Friday on Wall Street and in Europe rather than new-found confidence in progress being made on theEuro Zone debt crisis. Indeed, the re-emergence of sovereign risk jitters looks likely over the near term as the focus turns to how effectively the incoming Greek and Italian governments can implement deficit reduction schemes.
So far, Greecehas proven to be an excellentcase study of a country that promised a lot butdelivered little, failing repeatedly to meet the budget benchmarks set by its saviors at the EU and the IMF. With that as their base-line scenario, tradersareunlikelytoexpectmuchmore of Italy, at leastinitially.
The first true test of the markets’ confidence comes today in the form of anItalian bond auction, with the country scheduled to sell up to €3 billion in paper maturing in 2016. The uptake for the securities, including any buying from the ECB, as well as the prevailing yield levels will be closely watched to gauge Italy’s ability to sustainably refinance its obligations.
Related:Trading the Euro-Zone Debt Crisis
Asia Session: What Happened
|
GMT |
CCY |
EVENT |
ACT |
EXP |
PREV |
|
21:30 |
NZD |
Performance Services Index (OCT) |
50.6 |
- |
52.9 (R-) |
|
21:45 |
NZD |
Retail Sales ex Inflation (QoQ) (3Q) |
2.2% |
0.6% |
1.0% (R+) |
|
23:50 |
JPY |
Gross Domestic Product Deflator (YoY) (3Q P) |
-1.9% |
-2.2% |
-2.2% |
|
23:50 |
JPY |
Nominal Gross Domestic Product (QoQ) (3Q P) |
1.4% |
1.4% |
-1.5% |
|
23:50 |
JPY |
Gross Domestic Product Annualized (3Q P) |
6.0% |
5.9% |
-1.3% (R+) |
|
23:50 |
JPY |
Gross Domestic Product (QoQ) (3Q P) |
1.5% |
1.5% |
-0.3% (R+) |
|
4:30 |
JPY |
Industrial Production (MoM) (SEP F) |
-3.3% |
- |
-4.0% |
|
4:30 |
JPY |
Industrial Production (YoY) (SEP F) |
-3.3% |
- |
-4.0% |
|
4:30 |
JPY |
Capacity Utilization (MoM) (SEP F) |
-3.6% |
- |
2.4% |
Euro Session: What to Expect
|
GMT |
CCY |
EVENT |
EXP |
PREV |
IMPACT |
|
7:45 |
EUR |
French Current Account (€) (SEP) |
- |
-2.9B |
Low |
|
8:15 |
CHF |
Producer & Import Prices (MoM) (OCT) |
-0.3% |
-0.1% |
Low |
|
8:15 |
CHF |
Producer & Import Prices (YoY) (OCT) |
-1.9% |
-2.0% |
Low |
|
10:00 |
EUR |
Euro Zone Industrial Production (YoY) (SEP) |
3.6% |
6.0% |
Medium |
|
10:00 |
EUR |
Euro Zone Industrial Production (MoM) (SEP) |
-2.3% |
1.4% |
Medium |
|
10:00 |
EUR |
Italy to Sell €3bn in 2016 Bonds |
- |
- |
HIGH |
Critical Levels
|
CCY |
SUPPORT |
RESISTANCE |
|
EURUSD |
1.3620 |
1.3837 |
|
GBPUSD |
1.5943 |
1.6141 |
---Written byIlya Spivak, Currency Strategist forDailyfx.com
To contactIlya, e-mail This e-mail address is being protected from spambots. You need JavaScript enabled to view it .Follow me on Twitter at@IlyaSpivak
To be added toIlya's e-mail distribution list, senda notewith subject line "Distribution List" to This e-mail address is being protected from spambots. You need JavaScript enabled to view it
 |
"Simply a Must Read for Every Serious Forex Beginner" Available at Amazon Now also for Kindle
|
