In the unfolding battle of the central banks, euro continues hand over positions on expectations of a possible ECB rate cuts.In September, as it became known last Friday from the report, the inflation in the eurozone unexpectedly fell to 0.7% vs. 1.1%.
Meanwhile, the unemployment rate in the region increased from 12.0% to 12.2%, breaking up hope of recovery of the labor market.
In the U.S., the latest macroeconomic data boosted the chances of curtailing the asset purchase program, which is supporting the dollar. ISM manufacturing index rose in October from 56.2 to 56.4 mark, despite the expected decline to 55.0.
However, do not forget that the U.S. labor market continues to be weak, and the prospects of another deadlock in the negotiations on the debt ceiling (deadline coming February 7) can delay the early start QE curtailing.
U.S. stock indexes on the basis of last Friday’s trading showed growth in the range of 0,06-0,45% after the publication of statistics on the U.S. industry - the sector recorded growth for the fifth consecutive month, according to the auction.
By the close of trading, Dow Jones industrial average gained 0.45% - up to 15,615.55 points. Broad market index S&P 500 rose by 0.29% to 1761.64 points. The high-tech NASDAQ index, according to trade results, grew up by 0.06% - to 3922.04 points.
The index of business activity in the industrial sector of the U.S. economy (ISM Manufacturing) in October rose to 56.4% (from 56.2% in September) and now it stands on its maximum level since April 2011. Some analysts, on the contrary, expected the index to decrease to 55%. Thus, the data were better than expected.
Market participants also drew attention to the statements of the President of Federal Reserve Bank of Philadelphia Charles Plosser, who proposed to set the maximum amount of bond buying program, which is now tied to the state of the employment market. He believes that the limitation of quantitative easing will allow the U.S. the central bank to re-evaluate the state of the American economy.
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