Sunday, 18 October 2009
Housing starts are expected
Housing starts are expected to slip to 540,000 after February’s unexpected surge to 583,000. Meanwhile, initial jobless claims are expected to fall to 660,000 from 654,000 which should add to current growth fears as the fundamental data demonstrates that the labor market continues to deteriorate which will threaten any recovery in the housing sector and the broader economy. Therefore, we should continue to see dollar support if the domestic growth outlook follows the dimming global prospects. However, an unexpected improvement in these figures in conjunction with the expected improvement in the Philadelphia Fed manufacturing reading could help offset current pessimism and weigh on the green back. Additionally, JP Morgan Chase is due to report earnings and if they can continue the trend of positive earnings from the banking sector it could help fuel optimism.