Although much isn’t expected in the next two days – ahead of the EU summit – FX traders will be keeping their eyes on two major economic releases before the start of the European session.

Swiss investor confidence is expected to plunge for the sixth straight month in October – and the 9th out of the last 10 months.  In September, the Swiss ZEW survey plunged to a reading of -75.7.  The main culprit, fears of a severe slowdown on a overpriced USDCHF exchange rate.  This sentiment mimics what has already been taking place in the economy as fundamentals have already begun showing signs of stalling.  Retail sales missed estimates to the downside in the last 3 months out of 4.  Declining for the second consecutive month in August, retail sales slipped by 3.9% – following a 2.7% drop in July.  On an annualized basis, the report showed a decline of 1.9%.  Output hasn’t been that much better – slowing from a healthy Q1 pace.  The result has been a downward revision of growth forecasted for the Swiss economy – likely to translate into further pessimism reflected in the ZEW survey.

Across the region, currency traders will also be keeping on eye on the September UK retail sales report.  Expectations are for sales to have actually improved – rising by 0.6% year on year – as consumers hit stores ahead of the Fall season.  Month over month improvements are looking good, with anticipation of a 0.2% gain.  Should the report show consumer strength re-emerging in the economy, it would offer bullish momentum for the GBPUSD – which has been pushed lower since hitting 1.5843 yesterday.  The GBPUSD currently trades at 1.5740 in late Asian trading.

Source:  www.forexmarketshot.com