FOREX: USDCAD Meets Primary Target Yesterday, Bearish Trend in Place

The NY Fed's Empire State Manufacturing Survey impressed in November, with the current General Business Conditions index rising 8 points to a 1-year high 18.7 (well above the 5.8 expected). As such it's the 2nd highest reading since April 2022, with solidly-above-long-term average-readings now for 2 consecutive months, the first time we've seen that since 2021 for this notoriously volatile survey.

• The 6-month outlook pulled back 19.1 from to 30.3 prior, which had been the highest optimism since January.
• Activity indices were strong. New orders jumped to 15.9 from 3.7, setting a 12-month high just 2 months after setting a 17-month low; shipments rose 2 points to 16.8 while inventories turned positive after 3 consecutive negative months.
• The employment gauge edged up to 6.6 from 6.2, for a fresh 4-month high, while the average workweek rose to a multiyear high.
• Inflation remained stubbornly high but didn't show signs of worsening. Current prices paid fell to 49.0 after 52.4, with expected prices paid 6-months ahead down to 62.5 from 65.0. Both are elevated but suggest some moderation after October's sharp M/M rise that suggested inflation was picking up alongside with activity.
• In short, a solid start to the month's regional Fed manufacturing surveys. 

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Monday 17 November:

• Ukraine-France: French President Emmanuel Macron is hosting his Ukrainian counterpart, Volodymyr Zelenskyy, in Paris. During their meeting at Villacoublay air base near Paris, the two signed a letter of intent for Ukraine to purchase up to 100 Rafale fighter jets, as well as other French-made military equipment, in its efforts to repel Russia’s invasion. The purchases are due to be realised over a period of around 10 years, although questions remain on the ability of Kyiv to fund these purchases, having signed a separate letter of intent to purchase 100-150 Gripen jets from Sweden.

• +5,000 FVZ5 109-04.5, post time offer at 0836:59ET, DV01 $213,500.
• The 5Y contract trades 109-05.25 last (+1.25)