An in-depth review of the week in the markets. The economic numbers that mattered, what they did to the major currencies, and how the story driving the market is changing.
Actual, forecast and previous for the releases that moved markets, with the surprise colour-coded so you can read it at a glance.
How each result landed on the dollar, euro, pound, yen and the rest, and which way the pressure pointed.
How the week's data and central bank messages fit the bigger story the market is telling right now.
The smaller releases that still carry useful context, boiled down to a few plain lines.
Two central banks tightened within three days. The Reserve Bank of Australia lifted its cash rate by 25 basis points to 4.85% on Tuesday, and the Bank of England raised Bank Rate by 25 basis points to 4.00% on Thursday. Both moves were expected by the market, but neither came with a united committee, and both were explained by the same culprit: energy-driven inflation.
For bias purposes, the week moved both currencies' policy paths up a step, but the committees look more cautious than their headlines. The RBA's three dissenters and the divided views among Australian banks on December sit beside the BoE's unanimous move and Bailey's warning that conditions could require more. Both central banks pointed to the same source, which is fuel prices, and neither has yet seen the pass-through to wages that would make a hike cycle self-sustaining.
Friday's jobs report was the data event of the week. Employers added 165,000 jobs in October against a 65,000 forecast, and the unemployment rate fell to 4.1% from 4.2% against 4.2% expected. Pay growth beat as well, with average hourly earnings up 0.4% on the month against 0.3% expected, and 3.1% on the year against 2.9%.
For bias purposes, the week gave the dollar two opposing stories. The election result was greeted with a softer dollar and lower yields as it arrived, but Friday's jobs report, the ISM data and the improving consumer readings pulled Treasury yields and Fed hike odds back up, so by the end of the week the labour data had been the stronger driver of rates.
Eurozone flash inflation for October came in at 4.0%, as forecast and up from 3.8%, the highest in more than three years. Core inflation held at 2.5%, and energy prices were up 20.8% on the year, from 18.9%. The national picture varied widely: Italy 5.6%, France 3.8%, and Germany down to 2.8% from 3.3% thanks to fuel tax cuts that run through the end of the year. Producer prices rose 2.5% on the month, in line.
The final PMIs revised the picture for services in France sharply lower. French services finalised at 46.2 against the 48.4 flash estimate, a much deeper contraction, while French manufacturing was revised up slightly to 49.5. Germany's services PMI was revised up to 52.5 from 51.7, but the eurozone services figure was slightly weaker at 51.4 against 51.7, with manufacturing at 52.7. German retail sales fell 2.0% against 0.4% growth expected, French industrial production fell 0.5% against a 0.3% rise forecast, and German factory orders rose 4.4% against 4.6%, after a 10.1% fall the month before.
French 10-year yields at auction eased to 4.74% from 4.93%, and Spanish ones to 3.80% from 4.18%. In Switzerland, October CPI was 0.2% on the month against 0.0% expected, the manufacturing PMI rose to 56.7 against 55.3, and retail sales slowed to 1.6% against 3.0%, while unemployment held at 3.1%.
New Zealand's third-quarter labour data missed on every major measure. The unemployment rate rose to 5.7% against 5.5% expected, employment fell 0.1% against a 0.4% gain forecast, participation dropped to 70.4% from 70.6%, and private sector wages rose 0.4% on the quarter. The data came a week after the RBNZ held at 2.75% on a 4 to 3 vote against a hike, and analysts noted it made a December hike harder to justify and left the kiwi near a cycle low against the Australian dollar.
Canada's October labour force survey also disappointed. Employment fell by 4,700 against a 14,600 gain expected, following a loss of 68,300 the month before, and the unemployment rate rose to 6.7% against 6.5% expected, its highest since April. The Ivey PMI rose to 58.3 against 57.7, but the manufacturing PMI fell to 49.6 from 51.5, and the trade surplus widened to C$5.4 billion against C$4.8 billion expected. Ottawa tabled its federal budget on Thursday, with C$142.1 billion in new tax incentives, spending and other measures over five years, a projected deficit of C$62.3 billion this year and deficits above C$50 billion in each of the next four years, including a C$36.1 billion "productivity mega deduction" for business investment. The opposition Conservatives said they would vote against it.
After last week's weak official PMIs, China's private RatingDog surveys gave a mixed picture. Manufacturing came in at 52.0, as forecast (52.1 previously), but services fell to 50.8 against 51.7 expected. In Japan, the final manufacturing PMI was 53.3, as forecast, and a 10-year bond auction cleared at 2.77% against 3.10% before.
This recap summarises publicly reported economic data and central bank communications for the stated week. It is general information, not financial advice, and looks backwards only, so it makes no predictions. Combine it with your own bias work (COT positioning, central bank direction, seasonal tendency) before drawing any conclusions. Read the full disclaimer and risk warning.