Gold touches 7-week low


The dollar got on a firm footing from healthier than anticipated manufacturing PMI data. This in turn raised predictions for the Non-Farm Payrolls data this Friday, which may follow on to a Fed rate hike in a December. The Markit final reading reading was increased to 53.1 from 53.0 while the ISM reading rose from 58.8 to 60.8. As for economic data, only the total vehicle sales report and a speech from Federal Open Market Committee member Jerome H. Powell are lined up today.


The common currency continued to be dragged down by the Catalonian concerns. The challenge here underlies the strength of the European Union, as this sets a precedence for other European separatists seeking their own government. The Spanish government however continues to argue the constitutionality of the vote. As for economic data, Italian final manufacturing PMI and the jobless rate came in weaker than expected, while other low impact data came in line with predictions. The Spanish unemployment change reading is due today while German banks are closed for the holiday today.


The British pound continued to be stuck as Brexit concerns continue to impact the currency in addition to data coming in weak. The manufacturing PMI dropped to 55.9 from 56.7, which was lower than the anticipated slip to 56.3. Construction Though, PMI data is due today (with no change expected), traders will continue to focused on Brexit-related updates as the British government tries to instil confidence in their negotiating strategy.


The Swiss currency followed its European contemporaries as Swiss retail sales disenchanted with a 0.2% slip as opposed to an anticipated 0.5% increase. Though risk-off sentiment kept the franc supported. As there is a lack of reports from Switzerland today, market sentiment continues to remain in play.


The Japanese currency began to run with the bulls against most of its contemporaries as risk-off sentiment gained on geopolitical concerns. Among these are the deadly attack in Las Vegas and the violence in the Catalonian polls. Data from Japan also come in positive with the final manufacturing PMI increasing to 52.9 from 52.6. As no reports due from Japan today so risk appetite will most likely determine the direction of yen pairs.


Gold prices were little changed after marking a 7-week low on Tuesday, as equities and the dollar were buoyed in Asian trade by upbeat economic data and strong U.S. treasury yields. Spot gold was down 0.1 percent at $1,269.71 an ounce, after earlier touching its lowest since mid-August at $1,267.76.


Oil prices fell on Tuesday, declining for a second day and sapping more strength from a third-quarter rally, amid signs that a global glut in crude may not be clearing as quickly as some had hoped. U.S. crude was down 15 cents, or 0.3 percent, at $50.43 a barrel, after closing the previous session down $1.09, or 2.1 percent. Brent crude, the global benchmark, was down 26 cents, or 0.5 percent, at $55.86 a barrel. The contract fell 67 cents, or 1.2 percent, in the last session. Brent had notched up a third-quarter gain of about 20 percent, the biggest increase for that quarter since 2004 and traded as high as $59.49 last week. It is down about 6 percent from that level.

Economic Calendar (all times in GMT)

  • No high impact data on tap today.

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