Summary:

• OPEC is expected to extend the oil-cutting deal until the end of 2018
• PCE indices could steer the US dollar today
• CPI figures from euro area should confirm that inflation is still below the ECB target

 It’s an OPEC day as the cartel holds its annual meeting this Thursday. The street expects that OPEC will prolong oil-cutting agreement until the end of 2018. The bar for the cartel is set high and given current speculative positioning, oil prices could be highly volatile. Moreover, we’ll get inflationary figures from the US and the euro area, thus EURUSD also could take a wild ride. 

Tentative – OPEC meeting. Once again there are quite high expectations ahead of OPEC meeting. The street sees a 9-month extension until the end of 2018. OPEC has admitted lately, that rebalancing was too slow and therefore another production cut is not unlikely. Taking this into account and given high compliance with the accord, the extension is almost a done deal. However, investors have some concerns. Is OPEC able to keep a recent rally in oil prices? The meeting starts at 9:00 am BST and decision should be released after 2 pm BST. However, markets probably will react to leaks from the summit. 

10:00 am BST – the euro area, preliminary CPIs for November. The inflationary figures form Germany presented yesterday surprised to the upside. Hence, there is a quite big chance that the print for the whole eurozone could also surpass the expectations. A core measure is seen rising to 1.0% y/y from 0.9%, whilst the headline print is projected to come in at 1.6% y/y (1.4% previously).

1:30 pm BST – US, core PCE for October and weekly jobless claims. PCE is Fed’s favourite measure of inflation, thus the US dollar should react to today’s print. The index for October is seen rising to 1.4% y/y (0.2% m/m) from 1.3% (0.1%). At the same time, we also get weekly jobless claims which reflect a condition of the labour market. This reading is expected to inch higher to 240k from 239 prior. 

2:45 – US, Chicago PMI for November. This regional print is usually treated as the leading indicator. It’s expected to pull back slightly to 63.0 from 66.2.

10:30 pm BST – Australia, AIG Manufacturing Index for November. Given stronger figures from China, this print should also move higher. Previously it showed 51.1 pts.

 Will OPEC push the oil prices towards 2015 highs? Source: xStation5