Fundamental Analysis

Weekly Roundup Report 11/06/2017

• November 6, 2017

EVENT RECAP: WEEK ENDING 3^rd NOVEMBER 2017   North America   Non-Farm Payroll data significantly missed expectations with a rise of 261,000 new payrolls for October. Consensus estimates predicted 312,000 new payrolls would be added. Additionally, there was a sharp drop in Average Hourly Earnings when compared with the previous month, with 0% growth in October compared with 0.5% in September. October's FOMC meeting ended with no change in policy as the Committee awaited the appointment of a new Chair of the Federal Reserve. The Trump Administration reported that Jerome Powell will be Janet Yellen's successor.     Asia Pacific   The Manufacturing sector was relatively subdued in October with the Caixin Manufacturing index registering no change in expansion from 51 points in September. The Chinese Federation of Logistics and Purchasing released a report showing mild expansion in the sector to 51.6 points. At the recent Bank of Japan Monetary Policy meeting, committee members elected to leave current policies unchanged.   United Kingdom   The headline event of the week was the Bank of England's decision to hike interest rates by 25 basis points. It was the first time in 10 years that the bank has changed its forward guidance policy. The reaction was somewhat unexpected with the Pound dropping in value as a result. However, with inflation pushing 3% the Bank was in danger of foregoing their price stability mandate set at 2%.   Europe   Eurozone Macroeconomic reports were mixed; with GDP rising by 0.6% for the third quarter against expectations of a 0.5% rise. However, the result does indicate a slowdown from the previous quarter. Flash estimates of CPI for October were disappointing, hitting 1.4% for the month against a forecast of 1.5%. All non-energy, food and alcohol prices fell during the month, with the energy sector making the largest contribution to price inflation.