The culmination of several months relentless campaigning
arrives at its zero hour this week. American voters will take to the polls to
decide who will lead the single most important economy in the world.

The culmination of several months relentless campaigning
arrives at its zero hour this week. American voters will take to the polls to
decide who will lead the single most important economy in the world.

The November 6^th elections naturally play a huge
part in deciding the direction of the US economy, and as such investors will
have a keen eye on proceedings. Obama still maintains a narrow lead, but that
has depreciated in recent weeks. Whether the incumbent is elected for a second
term or Romney, the Republican candidate, is chosen, their different stances
towards the fiscal cliff, the Fed and tackling the US’ haunting deficit are
likely to cause a move towards dollar strength in the meantime.

Europe faces as crucial week too, as the egg timer on
Greece’s liquidity runs dangerously low. Greek Prime Minister Antonis Samaras
warned that his nation does not have the capacity to make further cuts, a requirement
that the troika demands before releasing any further tranches of funding.

Greece poses the threat of contagion to other teetering
economies such as Spain and Italy. If the uncertainty continues, it is likely
that there will be a knock-on effect to the euro, causing a drop against many
of the safer currencies.

 

Today’s Key
Announcements:

• 08.00am – EUR – Spanish Unemployment Change: much larger
  than expected at 128.2k
• 09.30am – EUR – Sentix Investor Confidence: expected at
  -20.7
• 09.30am – EUR – Services PMI: expected to show growth at 52
• 15.00pm – USD – ISM Non-Manufacturing PMI: expected at 54.6,
  slightly down from 55.1