We don't have much today on the agenda for the European session as the Swiss CPI is going to be the only highlight. In the American session, we get the two biggest data releases of the month as we get the US NFP and the ISM Manufacturing PMI.
Overall, I don't think that the data this week matters that much as we have the US elections on Tuesday, but it could still move the market and add some more info to the bigger picture.
07:30 GMT - Switzerland October CPI
The Swiss CPI Y/Y is expected at 0.8% vs. 0.8% prior, while the M/M measure is seen at 0.0% vs. -0.3% prior. Although inflation in Switzerland has been within the SNB’s 0-2% target for more than a year, it keeps on falling steadily with the Core measure standing around 1% now.
The market is pricing at 27% chance of a 50 bps cut in December and a soft report will likely raise those probabilities to roughly 50%. The central bank mentioned that the CHF strength has been a major drag on inflation but hasn’t taken any real action to address this problem yet.
12:30 GMT/08:30 ET - US October Non-Farm Payrolls
The US NFP is expected to show 113K jobs added in October vs. 254K in September and the Unemployment Rate to remain unchanged at 4.1%. The Average Hourly Earnings Y/Y is expected at 4.0% vs. 4.0% prior, while the M/M measure is seen at 0.3% vs. 0.4% prior.
This is going to be a tricky report given the distortions from hurricanes and strikes in October. Thankfully, the market is unlikely to care that much given the focus on the US election.
14:00 GMT/10:00 ET - US October ISM Manufacturing PMI
The US ISM Manufacturing PMI is expected at 47.6 vs. 47.2 prior. The New Orders index should be the one to watch as it should be the first to respond to the recent developments. The latest S&P Global Manufacturing PMI improved a little with new orders ticking higher albeit remaining in contractionary territory.
Businesses continue to mention uncertainty around the US election, so you can see why the market is so much focused on it. Watch the new orders index as that is the one that should respond first to the recent 50 bps cut from the Fed.
