Morning Market Review EURUSD, GBPUSD, AUDUSD, USDJPY, GOLD

📅The main economic events for the current week. 

It will be interesting to hear reports from the ECB President, as well as retail sales in the US and UK. Let me remind you that my tactics are as follows, I do not trade on the news, I take into account the time of the news release and regulate my trading accordingly.

EUR/USD

The European currency is showing a slight decline, correcting after an active two-day rally at the end of last week, which led to the renewal of local highs from August 11. The EUR/USD pair is testing 1.0300 for a breakdown, waiting for the publication of new drivers on the market. Today, investors will follow the publication of the September statistics on the dynamics of Industrial Production in the eurozone. Current forecasts suggest that the rate will sharply slow down from 1.5% to 0.3% MoM, but accelerate from 2.5% to 2.8% YoY. Tomorrow the focus of the market will shift to updated data on the Gross Domestic Product (GDP) of the euro area for the third quarter, as well as on the Employment Change. Analysts do not expect the GDP estimate to be revised from the previous 0.2% in quarterly terms and 2.1% in annual terms, while the Employment Rate may decline from 0.4% to 0.3% QoQ and from 2.7% to 1.8% YoY. On Thursday, November 17, inflation data will be published in the euro area, which may significantly affect the future decisions of the European Central Bank (ECB) on monetary policy. It should be noted that last Friday October statistics on the Consumer Price Index were presented in Germany. As expected, the dynamics of the indicator did not change compared to the previous month, when prices rose by 10.4%. In turn, the Harmonized Consumer Price Index again added 11.6%.

GBP/USD

The GBP/USD pair is trading in different directions, retreating from the local highs of August 26, updated at the end of last week. The pound, like many other currencies paired with the US dollar, showed active growth on Thursday and Friday, reacting to the publication of statistics on inflation in the US. At the end of October, consumer prices showed an increase of 7.7%, which turned out to be significantly lower than analysts' expectations of a decrease in dynamics from 8.2% to 8.0%. The published statistics increased the risks that the US Federal Reserve will slow down the pace of further interest rate hikes starting from the December meeting. At the moment, only about 20% of analysts expect a 75 basis point correction, while the majority is converging on the 50 basis point level. The British currency was slightly supported on Friday by macroeconomic statistics. The Gross Domestic Product (GDP) in the UK in the third quarter fell by 0.2% after rising by the same amount in the previous period, while analysts had expected a more confident contraction of 0.5%. On a monthly basis, however, the indicator lost 0.6%, beating forecasts of a 0.4% fall. In turn, the volume of Industrial Production increased by 0.2% in September after falling by 1.4% in August, while analysts expected the figure to be –0.2%.

AUD/USD

The Australian dollar is showing mixed trading dynamics, reversing downwards after a solid "bullish" rally last week. Against the backdrop of the publication of data on inflation in the US on Thursday, November 10, the Australian dollar showed steady growth, updating local highs from September 20. In October, the Consumer Price Index slowed down more than expected from 8.2% to 7.7%, which strengthened investors' confidence in the reduction in the pace of interest rate increases by the US Federal Reserve. At the moment, the vast majority of analysts expect only a 50 basis point correction in December, while before the release of the data, this probability was estimated at only 50%. Investor activity is likely to remain subdued today, as practically none noteworthy macroeconomic publications are planned. Tomorrow, the minutes of the meeting of the Reserve Bank of Australia are expected to be released, as well as a block of statistics from China, where, among other things, October data on the dynamics of Industrial Production and Retail Sales will be published. Current forecasts suggest that production will slow down from 6.3% to 5.2% and sales will decline from 2.5% to 1.0%.

USD/JPY

The US dollar shows a slight increase, consolidating near the local lows of August 31, updated at the end of last week. The USD/JPY pair is testing 139.40 for a breakout, having only technical factors at its disposal, but tomorrow investors will pay attention to October data on the dynamics of producer inflation and the speech of US Federal Reserve board member Lisa Cook. In turn, Japan is expected to release key statistics on the dynamics of Gross Domestic Product (GDP) for the third quarter on Tuesday. It is expected that the indicator will slow down from 0.9% to 0.3% in quarterly terms and from 3.5% to 1.1% in annual terms. Also tomorrow, September data on Industrial Production will be published: experts expect the figure to fall by 1.6%. At the end of the week, traders focus on inflation statistics. Despite the fact that all this time the Bank of Japan maintained a wait-and-see attitude, the Consumer Price Index in the country may begin to decline: current forecasts suggest that in October it will slow down from 3.0% to 2.7%.

XAU/USD

Gold prices show multidirectional dynamics, holding near local highs, updated last week. The XAU/USD pair is testing 1760.00 for a breakdown, waiting for the publication of new drivers on the market. The current downtrend is due to the correctional growth of the US currency, which was actively declining at the end of last week after the publication of inflation data in the US. In October, the Consumer Price Index fell from 8.2% to 7.7%, which was better than analysts' expectations of 8.0%. This prompted traders to reconsider their forecasts regarding the pace of interest rate hikes by the US Federal Reserve in the near future. Now, only about 20% of experts surveyed expect that the regulator may decide to adjust the value by 75 basis points during the December meeting. At the same time, it is too early to talk about any revision of the agency's monetary policy. In particular, member of the Board of Governors of the US Federal Reserve Christopher Waller said that the regulator will continue to adhere to a tight policy until the target inflation rate of 2.0% is reached. In addition, US officials have not yet reacted to the growing risks of recession in the economy, as is the case, for example, with the European Central Bank (ECB) or the Bank of England.

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