The past week has been important for the United States thanks to several factors: it was the Thanksgiving week, consumption has increased thanks to Black Friday and various market movers have been published giving more strength to the US dollar.
The week opened with the boom of the index of durable goods orders in October which were up of 4,8% in October, compared with the decline of the previous month to -0,3% (revised at + 0.4%). Excluding the transport sector, orders for durable goods increased of 1,0%, compared to + 0.1% in September (revised to + 0.2%).
Immediately after the publication of such data, it was released the minutes of the last Federal Reserve meeting. This has given way to a surge of the greenback, extending even further the trend undertaken in the last two weeks.
The Fed reports spoke of a strengthening of opinions in favor of a rise in interest rates in the face of a labor market in constant strengthening.
The probability seems to have become a certainty then: according to the market there will be an intervention on interest rate on December the 14 th , after one year.
After that, the euro-dollar exchange rate has reached new lows and the US currency has strengthened even more. EUR / USD broke the support of 1,06 area on Wednesday entering 1,05 area, to levels very close to the minimum of the beginning of December 2015. The decline was established just after the release of the FOMC minutes.
Also the consumer confidence in the US, calculated by the University of Michigan, surprising analysts’ expectations increasing to 93,8, compared with the previous result at 91,6.
The PMI index for the services sector in the US has instead recorded a slight drop in its preliminary version in November.
As reported by Markit, PMI of American services stood at 54,7. The results of the previous month amounted to 54,8.
Moving overseas, it was published the preliminary figure for UK GDP which stood at +0,5. This figure is in line with the forecasts of experts and the results of the previous survey.
English Minister of Finance, Philip Hammond, presented the budget program, outlining a hole of 58 billion pounds into the British deficit. The figure is the result of the slowdown of the growth caused by the divorce from the EU.
Immediately after the words of Hammond, the euro-sterling exchange retraced. The admission of the imminent exit from the EU and the cut of growth estimates for 2020 appear to have reinvigorated the pound which shows the change with the euro below 0.85.
Among the most important market movers of this week there is the OPEC meeting on the 30 th of November. The members will have to discuss on the impact of a possible agreement on the production between the oil exporting countries on the performance of the US dollar.
One of the market movers of the economic calendar will also be the Eurozone inflation and the performance of the manufacturing sector in the US.
To round up the week, there will be the US Non Farm Payrolls, looking for further confirmation of Federal Reserve possible increase of interest rates in December.
At the macroeconomic level, we point out the intervention of Mario Draghi that is expected before the Economics Commission and the European Parliament to report on the developments of the European Central Bank’s economic and monetary policy.