Forex Major Currencies Outlook (Dec 01, 2016)

The ADP non-farm employment change reading hinted at an upside NFP surprise while the Chicago PMI posted a sharp climb. Personal income was higher than expected but personal spending lagged. US initial jobless claims and ISM manufacturing PMI are up for release, setting the tone for Friday's NFP report.

EUR

The euro was able to recover against the commodity currencies and carried on its rally against the yen. Economic data from the euro zone came in line with expectations, particularly the CPI estimates, while the German retail sales figure surprised to the upside. Final manufacturing PMI readings are due today.

GBP

The pound was higher across the board after the BOE printed its Financial Stability Report and bank stress test results. UK manufacturing PMI is due today and a rise from 51.3 to 51.4 is eyed, possibly reflecting a stronger expansion in the industry.

CHF

The franc slid to the dollar and pound but managed to bounce back against the euro. The KOF economic barometer missed estimates and printed a drop to 102.2 from the downgraded 103.9 figure. Swiss retail sales data is due today and a 2.0% slide is eyed.

JPY

The yen continued to slide against its counterparts and the final manufacturing PMI upgrade from 51.1 to 51.3 seemed to be of no help. There are no other reports due from Japan today so yen pairs could extend their climb or react to market sentiment.

Commodity Currencies (AUD, NZD, CAD)

The OPEC decided to cut production to 32.5 million barrels per day starting January next year in their first output deal in eight years. This comes after Saudi Arabia gave in to Iran's demands to produce around 3.8 million barrels per day instead of cutting their own output to 3.7 million barrels per day. Australia's private capital expenditure report came in weaker than expected with a 4% slide while China's official manufacturing PMI beat expectations by rising to 51.7.

By Kate Curtis from Trader's Way