The EUR/USD got back to its “comfort zone” in the upper range between 1.0960/70 after a short knee-jerk skip under the 1.0940 handle. The pair’s descend in around the 1.0935 thresholds follows ECB’s (European Central Bank) B. Coeure’s statement in which he once again pointed out that the current QE program has a high flexibility although he also acknowledged the lingering risk of low inflation. In the Eurozone, we can see that the German CPI (Consumer Price Index) cam according to expectations in November, the consumer price going up YoY (year-on-year) with 0.4%.
In the US, Friday marked the release of household consumption figures by the Commerce Department. The data showed that retail sales did not go up as high as expected in November, raising concerns about the sustainability of a 25 basis points rate hike this month.
The headline figure came out 0.2% for November, marking its biggest growth in 4 months and exceeding the expected 0.3%. Retail sales excluding autos went up 0.4%, over the estimated 0.3% and over October’s 0.1% (downwardly revised from 0.2%). If gasoline and purchasing of autos were to be excluded, retail purchases rose 0.5% marking their highest advance since the month of July.
The retail sales control group (an indicator used in the calculation of the GDP – Gross Domestic Product), which doesn’t take into account food services, auto dealers, service stations and home-improvement stores hiked 0.6% in November, after a 0.2% rise in October and over the expected 0.4%. The Reuters/Michigan index which measures consumer sentiment came in at 91.8 versus a 91.0 forecast.
In China, latest data shows a growth in the industrial production in the month of November and a retail sales hike which market the biggest growth pace this year. This information is reiterating the fact that the world’s second large economy is showing clear signs of stabilization. The industrial output went up 6.5% this November compared to last year’s November as per the National Bureau of Statistic release on Saturday, with an expected value of 5.7% announced by experts from Bloomberg and a previous reading on 5.6% in October. There was a 10.2% increase in fixed-asset investments in these 11 months and an 11.2% gain in the retail sales sector in November.
Gold went up on during Friday’s session, but not enough to cover its weekly loss. The yellow metal bounced back and forth in the $1,062 and $1,078 per ounce area, closing the session just above $1,075 registering a 0.31% gain for the day but a 0.8% loss for the whole week. Investors are playing it safe until Fed’s decision on Wednesday.
