Economic Data Puts the U.S Dollar and the U.S Economy in the Spotlight

Earlier in the Day:

It’s was a relatively quiet start to the day on the economic calendar this morning. The Aussie Dollar and the Kiwi Dollar were in action in the early part of the day.

For the Kiwi Dollar

Ahead of the Asian open, the RBNZ released its Financial Stability Report for November. With the RBNZ prepared to drop rates into negative territory, there was plenty of interest.

Headline comments from the Report included:

• Fiscal and monetary support have both prevented a substantial rise in unemployment.
• Significant downside risks remain and some sectors will face continued stress.
• The financial system has been insulated from significant stress so far.
• Banks need to keep supporting customers and economic recovery.
• The RBNZ intends to reinstate LVR restrictions to manage risks from high-risk housing lending.
• Reserve Bank supports efforts to improve disclosure of climate risks.

The Kiwi Dollar moved from $0.69729 to $0.69743 upon release of the report that preceded Governor Orr’s speech later in the morning. At the time of writing, the Kiwi Dollar was up by 0.07% to $0.6983.

For the Aussie Dollar

Construction work done slid by 2.6% in the 3^rd quarter, following on from a 0.7% decline in the 2^nd quarter. Economists had forecast a 2% decline.

According to the ABS,

• Residential construction work done fell by 1.0%, while non-residential construction work down slid by 3.4%.
• Building construction fell by 1.0%, while engineering slid by 3.3%.

The Aussie Dollar moved from $0.73691 to $0.73640 upon release of the figures. At the time of writing, the Aussie Dollar was down by 0.04% to $0.7358.

Elsewhere

At the time of writing, the Japanese Yen was down by 0.11% to ¥104.55 against the U.S Dollar.

The Day Ahead:

For the EUR

It’s a relatively quiet day ahead on the economic calendar. From France, job seeker figures are due out later today. Barring particularly dire numbers, the impact on the EUR will likely be muted, however.

November’s private sector PMI numbers and containment measures to curb the spread of COVID-19 will impact labor market conditions. Weak numbers should, therefore, not be a surprise.

From the ECB, the Financial Stability Review will have an influence. How the ECB views financial stability amidst the economic meltdown is of particular relevance to what lies ahead on the policy front.

At the time of writing, the EUR was up by 0.09% to $1.1903.

For the Pound

It’s a particularly quiet day ahead on the economic calendar. There are no material stats due out, leaving the Pound in the hands of Brexit and market risk sentiment.

At the time of writing, the Pound was up by 0.02% to $1.3360.

Across the Pond

It’s also a particularly busy day ahead for the U.S Dollar. A data deluge ahead of Thanksgiving puts the Dollar and riskier assets in the spotlight.

Key stats include the weekly jobless claims, core durable goods, 2^nd estimate GDP, and personal spending figures.

Other stats due out include inflation, durable goods, consumer sentiment, and new home sales figures. These stats should have a relatively muted impact on the Dollar and the broader financial markets, however.

On the monetary policy front, the FOMC meeting minutes will also influence late in the session.

The markets are expecting the FED to deliver more support amidst the political wrangling on Capitol Hill. Failure by lawmakers to deliver a COVID-19 stimulus package has put the onus back on the FED.

At the time of writing, the Dollar Spot Index was down by 0.11% to 92.122.

For the Loonie

It’s another quiet day on the economic data front. There are no material stats due out to provide the Loonie with direction.

The lack of stats will leave the Loonie in the hands of U.S economic data and politics, and COVID-19 news updates.

At the time of writing, the Loonie was flat at C$1.2998 against the U.S Dollar.

For a look at all of today’s economic events, check out our economic calendar.