– Better-than-expected China data
– RBA revised down growth forecast
– US consumer confidence likely falls
What to watch for today
USD: Weaker confidence surprise. The preliminary November reading of the University of Michigan consumer confidence is the main event on the US calendar today, and markets are looking for a slight pick-up from 82.6 to 83.0. In contrast, our economists are looking for a weak surprise, as suggested by their 80.0 estimate. A print in line with our estimates would likely have a negative impact on risk appetite and would probably exert downside pressure on front-end rates. While USDJPY downside would be the standard playbook on soft US data, we
think the deterioration in Japan’s external accounts and the surge in M&A-related outflows are likely to limit JPY strength from current levels.
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