Daily Market Report 18/10/2013

The US dollar continued to lose ground yesterday as the market didn’t seem to take to the temporary solution to the US debt ceiling.

Adding to the downbeat sentiment on the US dollar, the number of people filing for jobless claims only fell by 15,000 instead of the 38,000 that the market had been anticipating. The data is disappointing and still doesn’t point to an improving situation with regards to the US job market.

Now that the government shutdown has ended, a back log of economic data is set to be released next week, which will help gauge the state of the US economy. Of key focus will be the delayed non-farm payroll figures for September, which is expected to show an extra 180,000 jobs were added. This will of course have a bearing on the arguments for tapering quantitative easing, so we will need to see how much support the data can provide for the US dollar.

From the UK yesterday, retail sales for the month of September rose more than expected to 0.6%, suggesting strong consumer demand which should aid growth for the UK economy. The data continued to support the pound as markets maintain their positive stance on the currency.

Data from China last night has bought in some investor appetite today, with their economy growing by 7.8% for the third quarter, rising from 7.5% in the second quarter. The growth was driven by stronger demand from overseas and within China.

Data is pretty sparse today, with only inflationary figures coming out from Canada.

Key Announcements:

13.30pm – CAD – Consumer Price Index (Sep): Expected to rise to 0.1% from August.