EUR: Q3 GDP data could heighten the difference in growth prospects with US - Westpac

Tim Riddell, Research Analyst at Westpac, suggests that after EU Commission cut its Eurozone 2017 GDP forecast for 2017 (to 1.5% from 1.8%), the release of regional and country Q3 GDP data could heighten the difference in growth prospects with US.

Key Quotes

“Data have been encouraging of late. ZEW surveys will be a critical measure of whether this run can be maintained into the ECB’s December meeting.

Meanwhile, Juncker’s hard-line response to Renzi over Italy’s budget may have the unintended consequence of pushing Italian voters to reject the referendum as a protest to both government and EU rather than constitutional reforms. The run up to the referendum could see a widening of spreads weighing on EUR.

SNB yet again stated their willingness to use NIRP and further cuts to cap CHF or assist the economy.

EUR/USD’s failure to hold above 1.12 opens the risk of deeper pullbacks within the past 12-months’ 1.05-1.16 range.”