5 Nov 2015
US data this week has been dollar-supportive in G10 – SocGen
FXStreet (Delhi) – Kit Juckes, Research Analyst at Societe Generale, suggests that today we get Q3 labour costs, and weekly jobless claims figures as warm-up for tomorrow's jobs report, but the US data this week has clearly been dollar-supportive in G10, without causing much consternation in global equity markets or indeed, in most emerging market currencies.
Key Quotes
“The US ADP data were much as expected but the non-manufacturing ISM (59.1) points to an economy in decent shape at the start of the fourth quarter. The manufacturing ISM may historically have a higher profile and at 50.1 was clearly not stellar, but that's a small part of the economy. In their testimony to the House Financial services Committee, Janet Yellen, Stanley Fischer and William Dudley all seemed happy enough for the market to ponder a December hike.”
“It's this lack of a broad negative reaction to increased talk of a hike that will encourage the less dovish Fed Governors, and which underpins the dollar. The yen and euro are both likely to out-perform it in ‘risk-off' days but so far, we're broadly avoiding those even as the front end of the US rates market adjusts.”
Key Quotes
“The US ADP data were much as expected but the non-manufacturing ISM (59.1) points to an economy in decent shape at the start of the fourth quarter. The manufacturing ISM may historically have a higher profile and at 50.1 was clearly not stellar, but that's a small part of the economy. In their testimony to the House Financial services Committee, Janet Yellen, Stanley Fischer and William Dudley all seemed happy enough for the market to ponder a December hike.”
“It's this lack of a broad negative reaction to increased talk of a hike that will encourage the less dovish Fed Governors, and which underpins the dollar. The yen and euro are both likely to out-perform it in ‘risk-off' days but so far, we're broadly avoiding those even as the front end of the US rates market adjusts.”