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China retail sales, IP to draw attention - RBS

FXStreet (Bali) - Strategists at RBS break down the key events in Asia for today, highlighting China retail sales, fixed asset investment and industrial production given ongoing market focus on China’s economy.

Key Quotes

"China retail sales, fixed asset investment and industrial production are released and likely to receive attention given ongoing market focus on the strength of China’s economy. More often than not, Chinese data have disappointed relative to expectations this year, with the drag from a weaker property market pulling down both fixed asset investment and retail sales in particular. Thus far, limited impact has been seen from the announcement of new infrastructure projects intended to help offset the slow-down in residential construction. On recent trends, we therefore see downside risks to commodity currencies, particularly the AUD, from these data."

"Elsewhere, German October inflation is expected to remain unrevised from the preliminary estimate, which showed an unexpected fall to 0.7% yoy on the EU harmonized measure, from 0.8% in September and versus the 0.9% consensus forecast. Any revision would likely be market-moving for the EUR given the ongoing focus on disinflation in the Euro area and the prospects of further ECB easing. In the US, initial jobless claims and JOLTS job openings may provide another reminder of the ongoing strengthening of the US labour market. Monetary policy divergence looks a compelling theme, and is likely to remain supportive of a lower EUR/USD multi-month in our view. Plosser and Kocherlakota of the Fed and Coeure of the ECB are also scheduled to speak."

Japan Machinery Orders (YoY) above forecasts (-1.3%) in September: Actual (7.3%)

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