Overnight News Bullets
UK Nationwide House Prices MoM/YoY (Oct) out at 1.1%/9.7% vs. 0.2%/8.5% expected.
GE Retail Sales MoM/YoY (Sep) out at 2.3%/-2.2% vs. 0.8%/-0.6% expected.
FR PPI MoM/YoY (Sep) out at 0.4%/2.7% vs. 0.3%/2.5% expected.
SW Consumer Confidence (Oct) out at 17.7 vs. 16.0 expected.
NO Retail Sales MoM/YoY (Sep) out at 1.5%/7.4% vs. 0.5%/6.1% expected.
NO Unemployment Rate AKU (Aug) out at 2.5% as expected.
E-Z Unemployment Rate (Sep) out at 7.3% vs. 6.9% expected. Prior revised to 7.4% from 6.9%.
E-Z CPI Estimate YoY (Oct) out at 2.6% vs. 2.3% expected.
E-Z Consumer Confidence (Oct) out at -6 vs. -5 expected. Industrial Confidence out at 2 as expected.
UK GfK Consumer Confidence (Oct) out at -8 as expected.
SZ KOF Swiss Leading Indicator (Oct) out at 2.02 vs. 2.1 expected.
US MBA Mortgage out at 3.8% vs. 0.0% prior.
US ADP Employment Change (Oct) out at 106K vs. 58K expected.
US GDP Annualized (3A Q) out at 3.9% vs. 3.1% expected. GDP Price Index out at 0.8% vs. 2.0% expected.
US Personal Consumption (3Q A) out at 3.0% vs. 3.2% expected.
US Core PCE QoQ (3Q A) out at 1.8% vs. 1.5% expected.
US Employment Cost Index (3Q) out at 0.8% vs. 0.9% expected.
CA GDP MoM (Aug) out at 0.2% vs. 0.1% expected.
PD Base Rates at 4.75% unchanged as expected.
NO Deposit Rates at 5.0% unchanged as expected.
US Chicago PMI (Oct) out at 49.7 vs. 53.0% expected. Prior at 54.2
US Construction Spending MoM (Sep) out at 0.3% vs. -0.5% expected.
US NAPM Miwaukee (Oct) out at 63 vs. 70 prior.
US DOE Inventories: Crude at -3894k vs. 400k exp, Gasoline at 1295K vs. -200K exp., Distillate out at 808K vs. -1000K exp, Refinery out at -0.97% vs. -0.5% exp.
US FOMC Rates 25bp lower at 4.50% as expected.
JN Net StocksInvestment out at 45.6B vs. -321.2B prior.
JN Net Bonds Investment out at 740.3B vs. 181.9B prior.
AU Retail Sales (Sep) out at 0.8% vs. 0.5% expected.
AU Retail Sales Ex Inflation QoQ (3Q) out at 1.9% vs. 1.6% expected.
AU Trade Balance (Sep) out at -1862M vs. -1000 expected.
Markets
FX: USDCAD in new all-time lows at 0.9426. GBPUSD in new 25-year highs above 2.08. EURUSD not able to sustain break above 1.45.
Fixed Income: Sold off after the FOMC as the Fed probably won??™t cut rates any further. JGB??™s following lower overnight.
Stocks: Solid increases following the FOMC ??“ S&P approaching July 2007 highs at 1556. Asia in new record highs.
Commodities: Oil taking another leg higher on weak supply, closing in on 100$/barrel. Gold (December contract) breaking 800$ for the first time in 27 years.
O/N Data Heat map:
Calendar
Today's Highlights:
| Time (GMT) | Region | Release | Consensus |
| 8:30 | SZ | SVME-Purchasing Managers Index (OCT) | 58 |
| 9:00 | NO | Unemployment Rate (OCT) | 1.70% |
| 11:30 | US | Challenger Job Cuts YoY (OCT) | Prior -28.5% |
| 12:30 | US | Personal Income (SEP) | 0.40% |
| 12:30 | US | Personal Spending (SEP) | 0.40% |
| 12:30 | US | PCE Deflator YoY (SEP) | 2.40% |
| 12:30 | US | PCE Core MoM/YoY (SEP) | 0.2% / 1.8% |
| 12:30 | US | Initial Jobless Claims (OCT) | 330K |
| 12:30 | US | Continuing Claims (OCT) | 2534K |
| 14:00 | US | ISM Manufacturing (OCT) | 51.5 |
| 14:00 | US | ISM Prices Paid (OCT) | 63 |
| 14:30 | US | EIA Natural Gas Storage Change (OCT) | 59 |
| 23:50 | JN | Monetary Base YoY (OCT) | 0.60% |
This and Next Week??™s Highlights:
| Date | Region | Release |
| 2-Nov | SZ | CPI |
| 2-Nov | NO | Norway PMI |
| 2-Nov | CA | Unemployment rate, Net change in unemployment |
| 2-Nov | US | Change in Nonfarm Payrolls, Unemployment Rate, Change in Manufacturing Payrolls, Average Hourly Earnings, Factory Orders, Baker Hughes Rig Count |
| 4-Nov | NZ | Tax Receipts, Labor Cost All Wages, Labor Cost Private Sector |
| 4-Nov | AU | AiG Performance of Service Index, TD Securities Inflation |
| 5-Nov | AU | ANZ Job Advertisments |
| 5-Nov | UK | Official Reserves, Industrial Production, Manufacturing Production, |
| 5-Nov | US | ISM Non-Manufacturing |
What's going on?
The FOMC cut rates by 25 bps. and stated that downside risk to growth is now balanced with upside risk to inflation. The Fed is thereby signaling that we need very disappointing labor market data to justify further rate cuts.
Initial reaction in stocks was to rally. The combination of quite strong Q3 GDP figures, a cut and comforting words from the Fed about the state of the economy should take stocks even higher in the next couple of weeks.
EURUSD tested 1.45 overnight, despite a streak of quite strong US figures yesterday.
The most USD-sensitive commodities rallying forcefully. Crude Oil soon testing $100/bbl ??“ and the economy is still OK. Precious metals making new highs. Watch 800 in gold and 14.75 in silver.
FX
FX Trading Strategies
| Pair | Supp. | Resis. | Comments |
| USDCHF | 1.156 | 1.163 | We have gone short at 1.1594 offer - targeting the break below 1.1550 with a stop bid at 1.1606. |