EUR / USD, GBP / USD
On Tuesday, mixed data on indicators of UK inflation came out but the release of positive data on the US and new progress on Brexit caused the pound to decline. The basic CPI in the UK for November remained at 2.7% y / y while the total CPI rose to 3.1% y / y from 3.0% y / y against the forecast of 3.0% y / y. Retail prices against the forecast of growth from 4.0% y / y to 4.1% y / y decreased to 3.9% y / y. Housing prices fell from 4.8% y / y after it was revised down from 5.4% to 4.5% y / y with expectations for growth to 5.2% y / y. In the US, the base producer price index rose by 0.3% in November with expectations of only 0.2%. The general producer price index rose by 0.4% to 3.1% y / y vs. 2.8% y / y in October. The index of optimism in the small business of the US has grown from 103.8 to 107.5. The budget report showed an increase in the deficit of 138.5 billion dollars against the forecast of 135.2 billion. However, investors and even the business media did not pay attention to this release probably because of yesterday's auction to place 30-year government bonds.
The index of sentiment in the business circles of the euro zone ZEW for December fell from 30.9 to 29.0. The ZEW index of Germany fell from 18.7 to 17.4.
Today, the October estimate of industrial production in the euro area will be released. It has a forecast of 0.0% after -0.6% in September. In the UK, the October unemployment rate is expected to fall at a 4.2% forecast from 4.3% earlier. The average wage growth for the last 3 months is expected to be at 2.5%. On these data, the GBP / USD is likely to rise out of the 1.3300 / 30 range before the release of US statistics. In the US, inflationary data are expected to be positive.
The base consumer price index is projected to grow by 0.2% while the total CPI can add 0.4% and on an annual basis growth may be from 2.0% to 2.2%.
This morning, the votes in Alabama for the Senate elections has been counted. This place became vacant after the occupation of Jeff Sessions in the post of Attorney General. In these elections, the question of an additional vote in the dispute over the tax reform was decided but Republican Roy Moore lost to Democrat Doug Jones at 48.8% against 49.5%. Today, Donald Trump appeared to probably discuss on this topic.
The discussion of the UK-EU trade deal will be next week and the outcome of these negotiations can only be, at best, some schematic plan. Michel Barnier said yesterday that a trade agreement can be reached by the time the UK leaves the EU. The pound has time to move down.
Today, the Fed will announce a decision on monetary policy, promulgate forecasts for the economy, and Janet Yellen will act.
We are waiting for the euro in the range of 1.1650 / 65, the British pound at 1.3225, further in the range of 1.3120 / 60.
USD / JPY
On Tuesday, the yen closed the day at the close of Monday. Although, conditions for further growth were there. The price index for corporate goods in November added 0.4% against the forecast of 0.2%, which increased y / y to 3.5% from 3.4% while expecting a fall to 3.3% y / y. The tertiary index of business activity in the service sector (retail, utilities, services) for October added 0.3% against expectations of 0.2%. The S&P 500 added 0.15% yesterday.
Today, according to base orders in machine building for the month of October, an increase of 5.0% is shown against expectations of 2.8%. On an annual basis, growth was 2.3% vs. -2.8% y / y. However, stock indices in the APR are losing today from -0.09% (S&P / ASX 200) to -0.50% for the Nikkei 225 itself. This is probably on fears of embarrassment in the adoption of tax reform in the US because of the loss of Roy Moore in the Senate elections. The balance of votes in the Senate will be 51:49 in favor of the Republicans which could threaten this bill. We remain calm on this issue. We believe that the sponsors of both US parties have previously agreed on these changes, as described earlier.
On Friday, the Tankan indices will be released for the fourth quarter. The forecasts are optimistic with Tankan Manufacturing expecting 24 vs 22and Tankan Non-Manufacturing predicting 24 vs 23. However, in connection with the release of a good tertiary index, the data can be even better.
We are looking forward to the yen's growth in the range of 114.70 / 90 and further to the level of 114.50.