Summary:

• The important package of data from Canadian economy comes into focus today, hence CAD can be more volatile than usual
• The US Senat is to resume debate and vote on tax bill proposal in the afternoon – reports from Washington should steer the US dollar and sentiment on the stock markets
• GBP has moved back to this year highs, the UK industrial PMI may pose a risk for bulls

Friday calendar looks interesting, especially in case of American markets. GDP reading and report from Canadian labour market could decide on market expectations of BoC’s rate hikes, hence CAD could be a big mover today. Moreover, a vote on tax bill proposal was delayed on today’s afternoon. In the morning the release of UK industrial PMI will be a key event.

8:50, 8:55, 9:00 am BST – final prints of manufacturing PMIs for November respectively from France, Germany, and the euro area. Initial figures were more than decent and we expect just a confirmation of them today. Thus, euro should hold steady in the morning. The flash prints: 57.5 (France), 62.5 (Germany), 60.0 (the euro area).

9:30 am BST – UK, manufacturing PMI for November. The UK pound has made impressive gains this week. Reports saying that brexit talks finally advanced pushed GBPUSD towards its this year highs. Thus, the print may pose a risk for bulls – the index is seen increasing to 56.5 from 56.3. On the other hand, the manufacturing industry is not the key sector of the UK economy, hence a volatility shouldn’t be large.

1:30 pm BST – Canada, GDP print for the third quarter and report from the labour market for November. A bountiful data package from Canada should be in the limelight today. If readings from Canadian economy disappoint, and the bar of expectation is not set low, then the prospects of further rate hikes from BoC could fade away putting pressure on CAD. Annualized GDP for the third quarter is forecasted to grow by 1.6% (prior: 4.5%), whilst employment is seen adding 10k jobs (prior: 35.3k).

3:00 pm BST – US, manufacturing ISM for November. ISM is as important for the US economy as PMI for European countries. Thus, USD should react to this data. Particular components of the report will build expectations ahead of inflationary prints and reports from labour market. The street calls for a slight decline to 58.4 from 58.7.

4:00 pm BST – US, vote on tax bill proposal in the Senate. The vote was to take place yesterday, however, this plan collapsed as there were too many points of disagreement. Republicans could lose just 2 votes o it’s unclear whether the draft is likely to pass. Moreover, it’s worth mentioning that after a successful vote Senate and House Representatives would have to work out a joint bill. 

6:00 pm BST – US, oil rig count. OPEC extended the oil output cut deal as expected and this should encourage the US producers to raise activity in drilling. 

 USDCAD is traded close to upper limit of recent consolidation. A successful re-test of the nearest resistance chould push the pair back towards the trend line. Source: xStation5