Summary:
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WASDE report may spur volatility on the grain market
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FOMC expected to stay on hold
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RBA statement released at night may be a trigger for AUD price swings
Economic calendar on Thursday looks quiet with just two market moving events scheduled. United States Department of Agriculture will release November’s WASDE report in the late afternoon therefore one may expect increased volatility on grains. Fed will make its interest rate decision in the afternoon with attention being drawn to the pace of future tightening. Apart from that, some price swings may occur on EUR at 10:00 am GMT as the European Commission will release its updated economic forecasts. Last but not least, AUD traders may want to stay on guard at night as RBA will release its quarterly monetary policy statement concerning inflation, economic growth and labour market.
5:00 pm GMT - WASDE report for November. Last month’s WASDE report triggered a short-term upward price move on the grain market. Estimates concerning corn ending stocks, yields and production are expected to be revised slightly higher and the same is forecasted when it comes to wheat. Soybean production and yields estimates are viewed to be revised a notch lower. Note that when it comes to the past few reports the move spurred by the data release was often followed in the next couple of days.
7:00 pm GMT - FOMC interest rate decision. When it comes to today’s FOMC meeting no one expects change in the monetary policy settings. As no press conference is scheduled after the meeting the attention will be solely drawn to the statement released along with the decision. What will be the point of interest in the statement? Any remarks on the pace of further rate hikes. Somewhat lacklustre price growth figures seen in the latest GDP report may have raised some concerns whether current pace is reasonable. While it is unlikely the pressures exerted by the US officials (mostly Trump) may have also took their toll.
Central bank speakers scheduled for today:
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8:00 am GMT - Riksbank’s Ingves and Floden
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1:00 pm GMT - ECB’s Villeroy de Galhau
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4:15 pm GMT - ECB’s Coeure
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3:20 pm GMT - ECB President Draghi
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5:30 pm GMT - SNB’s Maechler
Major US companies reporting earnings today:
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Activision Blizzard (ATVI.US)
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Walt Disney (DIS.US)
EURUSD managed to bounce of the YTD low around the 1.13 handle. The upward moved was halted yesterday a notch below the price zone that marked the lower bound of the consolidation range started in May. Note that a structure of lower highs and lows can be spotted therefore one cannot rule out potential retest of the 1.13 area. Source: xStation5
