The focus today will be on the UK as the European day starts with the country’s employment data. The report is not likely to move the needle either way however as both the claimant count rate and the unemployment rate are expected to remain the same (the former for the third consecutive month, the latter for the fifth consecutive month). The jobless claims rate, analogous to the US weekly jobless claims, is expected to be slightly higher but nothing dramatic. In short, the data are likely show the UK employment situation is steady. That’s actually not a bad outcome, given that survey measures of hiring intentions have been fairly weak and of course the economic picture has been uncertain since the Brexit referendum. If the data come in as expected, the currency is likely to be steady too.
US industrial production is forecast to rise a bit after two relatively weak months. This would be consistent with the increase in the average workweek and the rise in the ISM manufacturing index. The rise in the rig count also suggests that oil & gas production is increasing. Signs that US output is picking up and capacity utilization is increasing should add to the optimism about economic growth and future inflation that yesterday’s better-than-expected retail sales and Empire State manufacturing index engendered and be USD-positive.
The relatively small rise in US oil inventories that’s expected could be positive for oil, but I’d assume the price will be affected more by any further comments about the possibility of reaching an agreement at the Nov. 30th OPEC meeting.
Finally, the Australian unemployment rate is expected to rise even as the number of people in employment rises as well. That’s because the participation rate is expected to rise too. In that case, the rise in employment should be more important than the rise in the unemployment rate and the number could even be positive for AUD, although I wonder if market participants reacting quickly to a figure flashing up on the screen will be so analytical.