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00:01 United Kingdom RICS House Price Balance October 53% Revised From 54% 59% 57%
00:30 Australia National Australia Bank's Business Confidence October 12 5
05:00 Japan Consumer Confidence October 45.4 46.3 41.2
06:00 Japan Prelim Machine Tool Orders, y/y October -6.3% +8.4%
The yen slid to its lowest level in seven weeks versus the dollar as the gap between yields on Japanese and U.S. 30-year bonds widened to the most since 2011 amid signs of stabilization in the world’s largest economy. The yen weakened against major peers as Asian equities advanced for a second day, damping demand for haven assets.
Gains in the dollar may be capped before Janet Yellen faces a confirmation hearing on Nov. 14 for the top job at the Federal Reserve as traders assess whether the economy is strong enough for the central bank to reduce stimulus.
The pound held five days of gains versus Australia’s dollar before the Bank of England publishes economic and inflation forecasts tomorrow. The BOE’s “growth forecast is likely to be revised higher and a faster decline in unemployment is likely to be anticipated,” Brown Brothers Harriman & Co. strategists, led by its global head Marc Chandler, wrote in a research note. “Even if the medium-term inflation forecast is lowered, the market appears to be discounting the likelihood of a rate hike late next year or arguably early 2015.”
Demand for the Aussie weakened after a private survey showed business sentiment deteriorated last month. A report from National Australia Bank Ltd. showed business confidence fell to 5 in October from 12 the previous month.
EUR / USD: during the Asian session the pair fell to $ 1.3385
GBP / USD: during the Asian session, the pair traded in the range of $ 1.5965-95
USD / JPY: during the Asian session the pair rose to Y99.60
There is a full calendar on both sides of the Atlantic, but traders say focus is still on events later in the week, when Fed Chair Bernanke and Chair-nominate Yellen speak. The European calendar gets underway at 0700GMT, when German October final HICP data will be published. At 0730GMT, the Banque de France October business survey will cross the wires. At 0825GMT, ECB Governing Council member Ewald Nowotny will deliver a speech on "Monetary Policy at the Crossroads", in Vienna, Austria. Italian October final HICP data will cross the wires at 0900GMT. Back on the Continent, at 1000GMT, ECB Governing Council member Jens Weidmann is scheduled to speak about changes in personnel of Hessen Haupverwaltung, in Frankfurt. The OECD September leading indicator will be released at 1100GMT. The day sees three late central bankers speeches. At 1600GMT, ECB Executive Board member Joerg Asmussen sits on a panel discussing unorthodox monetary policy, in London.
UK inflation data is also set for release, with October CPI and PPI due to be released at 0930 GMT. At the same time, the official ONS September House Price Index will be released. Analysts expect consumer prices to have fallen back toward the Bank of England's Monetary Policy Committee's 2% target in October. Other survey data suggest inflation will ease.
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