FX.co ★ Concentration of forces before the new week

EUR / USD, GBP / USD

The US economic indicators on Friday came out optimistic which was reflected in the strengthening of the dollar, in relation to euro only. The British pound and commodity currencies slightly strengthened. Retail sales in the US for September increased by 1.6%, the base sales index increased by 1.0% against expectations of 0.9%. Inventories of companies for August increased by 0.7%. The data enable the Federal Reserve Bank of Atlanta to raise the GDP forecast for the third quarter from 2.5% to 2.7%. The consumer confidence index from the University of Michigan in October rose from 95.1 to 101.1. Disappointment caused lack of progress in inflation. The basic CPI remained at the level of 1.7% YoY against expectations of growth to 1.8% YoY, but the total CPI increased from 1.9% YoY to 2.2% YoY. However, the forecast was even higher at 2.3% YoY.

Jean-Claude Juncker, president of the European Commission, confirmed that the process of Britain's withdrawal from the EU will take longer than the expected period. While the UK will not be able to persuade the EU of a smaller amount of forfeit.

Good economic performance is expected across the Europe for today and tomorrow. This could possibly be in the hands of the remaining euro bucks in the market. Eurozone trade balance for August is expected to increase from 18.6 billion euros to 20.3 billion, while Germany's wholesale price index for September may increase by 0.4%. On Tuesday, we expect positive Euro Area Zew Economic Sentiment Index in business circles for October and the rise in UK's inflation indices. At the same time, the business activity index in the manufacturing sector of New York for October may show a decline from 24.4 to 20.3, and the federal budget may show a deficit of $1.0 billion which is the worst September value in the last 5 years.

On the other hand, dollar buyers have a good opportunity to buy against euro buyers at favorable prices. In this regard, a two-day consolidation of the euro is expected in the range 1.1775-1.1830 and the pound in the range of 1.3230-1.3320.

USD / JPY

On Friday, the yen lost over 40 points due to the combined situation regarding the dollar and lack of support from the stock market, as the S & P500 added just 0.09%. But today, the Japanese Nikkei 225 is growing by 0.68% due to optimistic expectations of the parliamentary elections, a week of which the party of the incumbent Prime Minister Shinzo Abe is leading. Having improved the indicator of 1997 (20911), Nikkei 225 is growing already on emotions. The monetary aggregate M2 increased by 4.0% YoY to 4.1% YoY Also in China, the money supply is increasing, as M2 has increased from 8.9% YoY to 9.2% YoY. While the lending in China also increased. Yields on Japanese government bonds are maintained in a weekly range.

On Monday, the Chinese CPI fell from 1.8% YoY to the forecasted 1.6% YoY in September, but it increased by 0.5% on a monthly basis versus expectations of 0.4%. The final assessment for Japan's industrial production in August was lowered to 5.30% YoY from 5.40% YoY, the monthly revision was 2.0% from 2.1%. The market did not react to the output of data. We are expecting for the slow growth of the pair to 112.50.