Market Movers
Today's main event is the ECB meeting. The pressure for further easing is building but we expect the ECB to keep its powder dry today. The latest comments from prominent ECB members have focused on the time remaining under the current QE programme and that it is still too early to decide whether more easing is needed. That said, we expect a continued dovish tone from ECB president Mario Draghi who is likely to repeat that the ECB can adjust the size, duration and composition of the QE programme. We still expect the ECB to announce an extension of the QE purchases beyond September 2016 at the meeting in December or in Q1 16. From a market perspective, where a deposit rate cut is priced with more than a 50% probability, we do not look for further clarity from Draghi, but we expect him to continue to focus on the possibilities under the QE purchases. See more in ECB Preview: More wait and see .
UK retail sales for September are expected to rebound after disappointing in both July and August. Overall we look for the lowest growth in retail sales in Q3 since Q4 13, which would be another sign that overall growth slowed in Q3. That said, we are still fundamentally positive about the outlook for private consumption due to increasing employment, positive real wage growth, rising house prices and low interest rates.
In the US existing home sales for September are due for release and after a decline of 4.8% m/m in August we look for an increase in sales. The weekly initial jobless claims, which dropped to a new low last week, are also due for release.
In Scandi markets focus is on Danish private consumption with the release of consumer confidence and retail sales - see more on page 2.
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