Asia Pacific markets are looking at growth positive moves today ahead of the release of key Chinese data mid-session. The US dollar is off to a mixed start, but commodity currencies are higher, and US stock futures are up around 0.5% this morning. The buoyant sentiment contrasts with reports of highs in global infection rates, and the re-introduction of lockdown measures in the UK and parts of Europe. Local futures also indicate positive opening moves across the region.

China GDP for the third quarter is expected to show quarter on quarter growth slowing to 3.3% after Q2’s 11.5% surge. This suggests that Q3 grew by 5.5% versus the same quarter last year. Some analysts believe recent strength in manufacturing numbers means there is a risk the data surprises to the upside. This could also feed into industrial production numbers for September (forecast 5.8%, previous 5.6%). Retails sales (forecast 1.6%, previous 0.5%) could paint a similarly robust economic picture.

The two key issues for markets this week remain US politics and the UK’s negotiations with the European Union over Brexit. The highly volatile US political landscape means a swing in sentiment is only a tweet or a headline away, although markets overall appear comfortable with a likely swing to the Democrat party. Currency traders are focussed of the EUR/GBP exchange rate, as an “Australia style” trade relationship after a “no-deal” exit gains in likelihood.


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