Investing.com – The euro trimmed most of the week’s losses against the U.S. dollar on Friday, amid fresh hopes for progress on resolving the euro zone’s debt crisis after Italy’s Parliament approved a package of new austerity measures and Greece swore in a new prime minister.
Market sentiment was boosted after Italy’s Parliament approved an amendment to the country’s 2012 budget, paving the way for the resignation of Prime Minister Silvio Berlusconi on Saturday.
The euro had fallen sharply on Wednesday, as yields on 10-year Italian bonds rose above the 7% level that prompted Greece, Ireland, and Portugal to seek international bailouts after a Paris based clearing house hiked the margin call on Italian bonds.
Meanwhile, in Greece caretaker Prime Minister Lucas Papademos and his cabinet were sworn in. Papademos will implement the country's latest EUR130 billion bailout before leading the country to early elections.
French bond yields climbed on Thursday after ratings agency Standard & Poor’s erroneously issued a message saying it had cut France's triple-A credit rating.
French borrowing costs remained higher on Friday despite a statement from S&P saying that the report was sent out because of a "technical error," as investors remained concerned over the possibility of a downgrade.
Elsewhere Friday, preliminary data showing that U.S. consumer sentiment rose to its highest level in five months this month contributed to stronger risk appetite.
The University of Michigan’s consumer sentiment index rose to a seasonally adjusted 64.2, from 60.9 in October, outstripping forecasts for an increase to 61.0.
The pound was also sharply higher against the greenback on Friday. On Thursday, the Bank of England kept interest rates unchanged at a record low of 0.5% in a widely expected decision. The central bank also left asset purchase plans unchanged.
Elsewhere, the greenback rose to its highest level against the yen since Japan’s intervention on October 31, amid speculation that Japan would refrain from further moves to curb the appreciation of the yen.
Japan’s Finance Minister Jan Azumi said he will keep a close watch on the foreign exchange market to see if there are speculative moves driving up the yen.
In the week ahead, investors will continue to closely monitor developments in the euro zone as talks on the formation of an emergency government in Italy get started. The euro zone is also to publish preliminary data on third quarter growth, which will be closely watched to gauge the strength of the region’s economy.
Also next week, the U.S. is to release data on retail sales, housing and inflation.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, November 14
New Zealand is to release official data on retail sales, the foremost indicator of consumer spending, which accounts for the majority of overall economic activity. Japan is to publish government data on gross domestic product, the broadest measure of economic activity and the primary gauge of the economy's health.
Switzerland is to produce a government report on producer price inflation, while the euro zone is to publish official data on industrial production, a leading indicator of economic health.
Later in the day, Bank of Canada Governor Mark Carney is to speak; his comments will be closely watched for any clues to the future possible direction of monetary policy.
Tuesday, November 15
The Reserve Bank of Australia is to release the minutes of its November policy meeting. The minutes are closely watched as they give investors a detailed insight into economic conditions from the bank’s point of view. Australia is also to release official data on new vehicle sales, a leading indicator of consumer spending.
The euro zone is to release preliminary data on GDP, while France and Germany are to publish individual reports. In addition, the ZEW Centre for Economic Research is to release a report on economic sentiment both in Germany and the euro zone.
The U.K. is to publish official data on consumer price inflation, which accounts for a majority of overall inflation.
Elsewhere, Canada is to produce government data on manufacturing sales, a leading indicator of economic health.
Also Tuesday, the U.S. is to produce a flurry of economic data with reports on retail sales, producer price inflation, business inventories and a report on manufacturing activity in New York State.
Wednesday, November 16
Australia is to publish an index of leading economic indicators, designed to predict the future direction of the economy. The country is also to publish data on wage costs, a leading indicator of consumer inflation. Also Wednesday, RBA Governor Glenn Stevens is to speak.
Meanwhile, New Zealand is to publish official data on producer price inflation input, a leading indicator of economic health.
The Bank of Japan is to announce its benchmark interest rate; the announcement will be followed with a press conference to discuss the factors which affected the rate decision.
The U.K. is to release official data on claimant count change and the unemployment rate, leading indicators of economic health. The BoE is to publish its quarterly inflation report, which outlines the bank’s outlook for inflation over the following two years. BoE Governor Mervyn King will hold a press conference to discuss the report.
Elsewhere, the euro zone is to publish official data on consumer price inflation, which accounts for a majority of overall inflation.
Later in the day, the U.S. is to publish data on consumer inflation, as well as data on industrial production, the capacity utilization rate, crude oil stockpiles and the balance of foreign and domestic investment in long-term securities.
Thursday, November 17
The BoJ is to publish its monthly report, which gives investors a detailed insight into economic conditions from the bank’s point of view.
The U.K. is to produce government data on retail sales, while the ZEW Centre for Economic Research is to publish a report on economic expectations in Switzerland.
Later in the day, Canada is to publish official data on foreign securities purchases.
Also Thursday, the U.S. is to publish its weekly report on initial jobless claims, as well as data on building permits, an excellent gauge of future construction activity and housing starts. The country is also to release a report on manufacturing activity in Philadelphia, a leading indicator of economic health.
Friday, November 18
In the euro zone, Germany is to publish official data on produce price inflation.
Later in the day, Canada is to publish official data on consumer price inflation, as well as an index of leading economic indicators, designed to predict the future direction of the economy.
Market sentiment was boosted after Italy’s Parliament approved an amendment to the country’s 2012 budget, paving the way for the resignation of Prime Minister Silvio Berlusconi on Saturday.
The euro had fallen sharply on Wednesday, as yields on 10-year Italian bonds rose above the 7% level that prompted Greece, Ireland, and Portugal to seek international bailouts after a Paris based clearing house hiked the margin call on Italian bonds.
Meanwhile, in Greece caretaker Prime Minister Lucas Papademos and his cabinet were sworn in. Papademos will implement the country's latest EUR130 billion bailout before leading the country to early elections.
French bond yields climbed on Thursday after ratings agency Standard & Poor’s erroneously issued a message saying it had cut France's triple-A credit rating.
French borrowing costs remained higher on Friday despite a statement from S&P saying that the report was sent out because of a "technical error," as investors remained concerned over the possibility of a downgrade.
Elsewhere Friday, preliminary data showing that U.S. consumer sentiment rose to its highest level in five months this month contributed to stronger risk appetite.
The University of Michigan’s consumer sentiment index rose to a seasonally adjusted 64.2, from 60.9 in October, outstripping forecasts for an increase to 61.0.
The pound was also sharply higher against the greenback on Friday. On Thursday, the Bank of England kept interest rates unchanged at a record low of 0.5% in a widely expected decision. The central bank also left asset purchase plans unchanged.
Elsewhere, the greenback rose to its highest level against the yen since Japan’s intervention on October 31, amid speculation that Japan would refrain from further moves to curb the appreciation of the yen.
Japan’s Finance Minister Jan Azumi said he will keep a close watch on the foreign exchange market to see if there are speculative moves driving up the yen.
In the week ahead, investors will continue to closely monitor developments in the euro zone as talks on the formation of an emergency government in Italy get started. The euro zone is also to publish preliminary data on third quarter growth, which will be closely watched to gauge the strength of the region’s economy.
Also next week, the U.S. is to release data on retail sales, housing and inflation.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, November 14
New Zealand is to release official data on retail sales, the foremost indicator of consumer spending, which accounts for the majority of overall economic activity. Japan is to publish government data on gross domestic product, the broadest measure of economic activity and the primary gauge of the economy's health.
Switzerland is to produce a government report on producer price inflation, while the euro zone is to publish official data on industrial production, a leading indicator of economic health.
Later in the day, Bank of Canada Governor Mark Carney is to speak; his comments will be closely watched for any clues to the future possible direction of monetary policy.
Tuesday, November 15
The Reserve Bank of Australia is to release the minutes of its November policy meeting. The minutes are closely watched as they give investors a detailed insight into economic conditions from the bank’s point of view. Australia is also to release official data on new vehicle sales, a leading indicator of consumer spending.
The euro zone is to release preliminary data on GDP, while France and Germany are to publish individual reports. In addition, the ZEW Centre for Economic Research is to release a report on economic sentiment both in Germany and the euro zone.
The U.K. is to publish official data on consumer price inflation, which accounts for a majority of overall inflation.
Elsewhere, Canada is to produce government data on manufacturing sales, a leading indicator of economic health.
Also Tuesday, the U.S. is to produce a flurry of economic data with reports on retail sales, producer price inflation, business inventories and a report on manufacturing activity in New York State.
Wednesday, November 16
Australia is to publish an index of leading economic indicators, designed to predict the future direction of the economy. The country is also to publish data on wage costs, a leading indicator of consumer inflation. Also Wednesday, RBA Governor Glenn Stevens is to speak.
Meanwhile, New Zealand is to publish official data on producer price inflation input, a leading indicator of economic health.
The Bank of Japan is to announce its benchmark interest rate; the announcement will be followed with a press conference to discuss the factors which affected the rate decision.
The U.K. is to release official data on claimant count change and the unemployment rate, leading indicators of economic health. The BoE is to publish its quarterly inflation report, which outlines the bank’s outlook for inflation over the following two years. BoE Governor Mervyn King will hold a press conference to discuss the report.
Elsewhere, the euro zone is to publish official data on consumer price inflation, which accounts for a majority of overall inflation.
Later in the day, the U.S. is to publish data on consumer inflation, as well as data on industrial production, the capacity utilization rate, crude oil stockpiles and the balance of foreign and domestic investment in long-term securities.
Thursday, November 17
The BoJ is to publish its monthly report, which gives investors a detailed insight into economic conditions from the bank’s point of view.
The U.K. is to produce government data on retail sales, while the ZEW Centre for Economic Research is to publish a report on economic expectations in Switzerland.
Later in the day, Canada is to publish official data on foreign securities purchases.
Also Thursday, the U.S. is to publish its weekly report on initial jobless claims, as well as data on building permits, an excellent gauge of future construction activity and housing starts. The country is also to release a report on manufacturing activity in Philadelphia, a leading indicator of economic health.
Friday, November 18
In the euro zone, Germany is to publish official data on produce price inflation.
Later in the day, Canada is to publish official data on consumer price inflation, as well as an index of leading economic indicators, designed to predict the future direction of the economy.