Daily Market Report - 21/11/2014

USD
The Dollar had a mixed day yesterday after the higher than forecast consumer pricing index was counteracted by disappointing unemployment claims. Figures revealed Fewer Americans filed for unemployment benefits last week as the need to retain staff keeps firings at the lowest levels in more than a decade, giving the Dollar a boost. The unemployment claims figure was better than last month’s figure but below the forecast. 

Companies are holding on to more workers to keep pace with demand for domestic goods and services that has held up even as growth in overseas markets cools. As a result, firings have lingered near historically low levels and payrolls are rising, giving U.S. households a needed lift as the holidays approach.

Prices in the U.S. excluding fuel and food increased more than forecast in October as a drop in energy costs failed to filter through to other goods and services. Rising costs for rents, airline fares, hotel rooms and furniture show the slowing in overseas growth that is helping restrain fuel prices.

GBP
British retail sales jumped in October, suggesting that shoppers will take the edge off an end-of-year economic slowdown as Europe's weak growth takes its toll on Britain's factories. Sales volumes rose by a much stronger-than-expected 0.8 percent on the month, helped by purchases of furniture after the housing market surged earlier this year and by falling prices. Consumer spending has driven Britain's strong economic recovery which began in mid-2013 and is likely to remain its main driver as the global economic outlook worsens.

A survey showed British manufacturers expect output in the next three months to be its lowest in over a year, hurt by the sluggish euro zone and a slowdown in China. A separate report showed British car production fell by nearly 7 percent in October due to weak exports.

Bank of England policy-makers have questioned how long private demand can continue to offset weak exports and the effects of public sector spending cuts, according to minutes of their November meeting which were published on Wednesday.

EUR
Hope of a Eurozone end-of-year recovery have been dashed by a flurry of poor data released yesterday. The composite purchasing managers’ index – a survey of private sector firms across services and manufacturing fell to 51.4 in November from October’s 52.1. Any figure above 50 signifies growth, but this sluggish growth is becoming slower.

Key Announcements:

08:00 - EUR – ECB President Mario Draghi makes a speech

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