Summary: 

• Monday is calm data-wise, the US new home sales print in the limelight today
• OPEC is expected to extend its output cuts for the whole 2018 this week
• Inflation data and other prints from the US economy could prop up the USD

It’s going to be a slow start to the week given that today’s calendar is rather empty. We’ve got only one release on the agenda – the US new home sales for October – and it won’t be a market mover. However, investors should closely track developments on cryptocurrency market as Bitcoin nears $10,000 handle. The rest of the week seems to be more interesting given OPEC meeting and a string of US data which may decide on USD strength. 

3:00 pm BST – US, new home sales data. The US housing market has been resilient despite a few interest rate increases which underscores a good shape of the US households. The prices are more or less steady and the volume comes back to normal after disruptions caused by hurricanes. The street calls for a decline of 6.3% m/m after a surge of 18.9% m/m in September. 

What to watch beyond Monday?

The OPEC meeting (Thursday)

A year ago the OPEC introduced a limit on output for its members and associated countries in a response to reeling prices that threatened not only public finances but even social unrest in many producing countries. Officially the aim was not to affect prices but to balance the market. While a balancing is still taking place, impact on prices has been a success for the Cartel as these expanded by 20% over the course of past 12 months and more than 10% over the past 3 months alone. The OPEC is expected to prolong the deal until the end of 2018 but keep in mind that some of the good news could have been already discounted. For example, a level of non-commercial positioning on oil is close to all-time highs. Affected markets: OIL, OIL.WTI 

Inflation data in the US (Thursday, 1:30 pm BST)  

The minutes from the last FOMC meeting revealed that some members are increasingly concerned about inflation even though the economy in the US is doing great. Despite the CPI inflation running around 2%, the Fed targets a different inflation measure, the PCE. A headline PCE inflation was at 1.6% in September and a core at just 1.3%, way off the 2% target. Many members at the Fed may want to see these numbers moving up if they are about to back more interest rate hikes. Affected markets: EURUSD, Gold

Payrolls and GDP data in Canada (Friday, 1:30 pm BST)

The Canadian dollar has seen a mixed fortune so far in the present quarter after an astonishing third quarter. This is because of the Bank of Canada that cooled expectations after increasing interest rates twice during the previous quarter. However, the CAD could be back in favour should the data support future rate increases. Friday’s package will include payrolls, monthly and quarterly GDP and the PMI. Affected markets: USDCAD

 OIL.WTI has been ascending since the mid-2017 and bulls may aim at highs from 2015. SOurce: xStation5