Forex Major Currencies Outlook (Oct 13, 2017)

Headline PPI posted a 0.4% uptick while core PPI also showed a 0.4% gain, twice as much as the estimated 0..2% uptick. Initial jobless claims fell from 258K to 243K versus the projected 251K figure. Headline retail sales could show a 1.7% rebound while core retail sales could come in at 0.9%. Headline CPI could show another 0.2% uptick. 

EUR 

The euro was able to pocket a few gains when ECB official Coeure reiterated the need to scale back asset purchases but these gains were erased when Draghi highlighted the effectiveness of negative rates and QE. Data came in mixed as industrial production beat expectations with a 1.4% gain versus the estimated 0.6% increase while the French final CPI was downgraded to show a larger 0.2% downtick from the earlier 0.1% dip. German final CPI is due today. 

GBP 

The pound had a very volatile run as it initially dropped on a deadlock with Brexit negotiations but rallied sharply later on when the EU appeared amenable to a two-year transition period, provided the UK is able to meet its financial obligations. Only the BOE credit conditions survey was released then while today has the CB leading index. 

CHF 

The franc had a mixed performance as it gave up ground to European rivals but consolidated to the Loonie and Aussie. There were no reports out of the Swiss economy then while today has the PPI lined up. Another 0.3% uptick is eyed and a downbeat result could mean more franc weakness. 

JPY 

The yen regained some ground to its peers as traders probably booked profits off the recent moves. Data from Japan was mixed as PPI came in line with estimates of a 3% gain while tertiary industry activity surprised to the downside with a 0..2% drop. There are no reports due from Japan today so yen pairs might take their cues from global bond yields and risk sentiment. 

Commodity Currencies (AUD, NZD, CAD) 

The comdolls were mostly stronger for the day as risk appetite was present but the Loonie took a few hits on weaker housing data. Chinese trade balance is due today and a smaller surplus is eyed, possibly indicating weaker global demand. There are no other reports due from the comdoll economies for the rest of the day. 

By Kate Curtis from Trader's Way