US GDP DATA IN FOCUS ON THURSDAY
The US economy will be front and centre on Thursday as the Commerce Department sets to unveil its third and final estimate of third quarter growth.
The official GDP report is scheduled for release at 13:30 GMT, and is expected to show 3.3% annual growth between May-July. That’s the fastest pace of expansion in three years.
The US economic calendar also sees the release of initial jobless claims for the period ended 16 December. Meanwhile, the Philadelphia Fed will release its manufacturing survey for December and the Federal Reserve Bank of Chicago will issue its monthly National Activity Index. Rounding out the US release schedule is the housing price index courtesy of the Federal Housing Finance Agency.
North of the border, the Canadian government will report on retail sales and consumer inflation at 13:30 GMT. Receipts at Canadian retail stores are forecast to climb 0.3% in October. The consumer price index (CPI) is expected to rise 2% annually in November following a 1.4% increase the previous month.
Earlier in the day, the Bank of Japan (BOJ) voted to leave monetary policy on hold in a decision that was widely predicted by the financial markets. The BOJ voted 8-1 to keep interest rates at a record low of -0.1%.
"Japan's economy is expanding moderately," the BOJ said in its official policy statement. The central bank added that inflation is “likely to continue on an uptrend” back toward its 2% target.
Japan’s gross domestic product (GDP) has expanded for seven straight quarters, the longest stretch of uninterrupted growth in over a decade.
The euro saw its rally stall on Wednesday, with the EUR/USD pair struggling to return to the 1.1900 level. The pair was last seen trading at 1.1867, where it was little changed compared to the previous close. From a technical perspective, immediate support is located at 1.1825, followed by 1.1800. On the opposite side of the ledger, resistance is seen up ahead at 1.1900.
The British pound stalled again at a key resistance level, a sign that the bulls were struggling to justify bigger rallies in the wake of the US Federal Reserve’s decision to raise interest rates. The GBP/USD exchange rate was last seen trading at 1.3362, where it was down 0.1% compared to the previous close.
The Japanese yen was little changed following the BOJ rate statement. The USD/JPY was last seen trading at 113.39, having established a narrow range throughout the early morning session. The pair was recently rejected at the 113.50 resistance level, a sign that further upside could be limited. Initial support is located at the 113.00 level. A clean break above 113.50 would put USD/JPY on a collision course with the 114.40 mid-term resistance.