Advance US Q3 GDP preview: What to expect of EUR/USD?

By FXStreet FXStreet (Mumbai) – As dust settles over the Fed aftermath, the next risk event that is expected to garner a lot of attention is the first estimate of the third quarter US GDP release. The US GDP estimate is due to be published at 12.30GMT, with markets widely anticipating a sharp deceleration in the pace of growth in the September quarter.

Poor US Q3 GDP to pour cold water over Dec Fed rate-hike bets?

Markets are predicting the advance Q3 GDP to show a 1.6% increase y/y, less than half of the expansion seen in the previous quarter. The second quarter witnessed a solid 3.9% expansion in the US economic growth.

Earlier this week, corporate spending in the US dropped 1.2% in September, following a 3% drop in August, an even bigger downturn than first reported. Orders in a category that serves as a proxy for business investment fell 0.3% after a 1.6% drop in August.

In case the GDP estimate surprises on the upside, then it would further reinforce Dec Fed rate rise expectations as the Fed remains data-dependent for policy normalization. Not forgetting, there remain two more NFP reports to monitor ahead of the Dec gathering.

Analysts at TDS noted, “With the …read more

Source:: FX Street