Eurozone inflation remains unchanged for November

The downward pressure on the euro versus the dollar is also coming from the Federal Reserve, which is expected by many to raise interest rates for the first time in years at a December 15-16 meeting.

MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.3 percent in early trading, while Japan’s Nikkei added 0.5 percent. Goldman Sachs rose $3.05, or 1.6 percent, to $193.07 and Bank of America rose 38 cents, or 2.2 percent, to $17.81. Meanwhile, Jens Weidmann – the head of the Bundesbank and a governing council member of the European Central Bank – warned that the longer we go with ultra-loose monetary policy, the greater the risks.

The expected divergence in the monetary policies of the two central banks has weighed on the euro but bolstered the dollar.

The ECB will decide on Thursday whether to expand its economic stimulus program, which functions similarly to the bond-buying program the Fed used after the financial crisis to keep long-term interest rates low.

They expect ECB President Mario Draghi to announce an extension of the bank’s quantitative easing programme as he attempts to increase inflation in the Eurozone, and cut interest rates on euro deposits.

And eurozone unemployment hit its lowest level for almost four years in October, falling to 10.7 per cent from 10.8 per cent in September.

U.S. Treasury debt prices rose with yields touching near one-month lows. “Another 5 percent next year would be fine on a trade-weighted basis but much more than that and it will affect their ability to speed things up in 2017”. Expectations are high for November, with economists looking for the report to show a creation of 271,000 jobs last month. Securities that allow investors to bet on which way the Fed will move rates are forecasting a 79 percent probability that the Fed will tighten.

“Japanese importers have demand for dollars, so any good figure, then 124, here we come”, said Kaneo Ogino, director at foreign exchange research firm Global-info Co in Tokyo.

“Generally the last couple of weeks have been very quiet”.

USA crude added 0.5 percent to US$41.88 a barrel. Crude oil prices seemed to climb by 45 cents on the barrel. Heating oil rose a cent to $1.369 a gallon, wholesale gasoline rose six cents to $1.363 a gallon and natural gas was roughly unchanged at $2.231 per thousand cubic feet.

The euro fell 0.2 percent versus the dollar on Monday and has fallen 4 percent against the greenback in November. The euro rose to $1.0586, after dropping to a 7 1/2-month low of $1.0557 on Monday.

In currencies, the euro gained 0.4 per cent against the dollar at $US1.0606.

However, Zodiac Aerospace fell 4.1 percent after Exane BNP Paribas downgraded it to “neutral” from “outperform”, while auto parts group Valeo (Paris: FR0000130338 – news) slipped 1.6 percent after BNP Paribas (Xetra: 887771 – news) sold some shares in the company.