U.S. personal income growth seems to have accelerated in October

U.S. spending is expected to have remained strong, while inflation is likely to have continued firming in October. According to a Societe Generale research report, U.S. personal income is anticipated to have grown by about 0.4 percent in October, owing greatly to a large gain in average hourly earnings and moderate gains in job. In October, private payrolls rose 142,000; however, average hourly earnings rose 0.4 percent, bringing the year-on-year rate to a new cycle high of 2.8 percent.

This is expected to have driven the salary and wage print higher in the month. In the meantime, the strength in the control group in the October retail sales figure indicates towards a strong 0.6 percent rise in nominal expenditures. Real spending is likely to have increased strongly by 0.3 percent, highlighting that the consumer continues to be the main driver of growth, said Societe Generale.

On the inflation side, the core PCE deflator is anticipated to have increased 0.1 percent; however, a modest increase might stimulate the year-on-year core PCE reading to 1.8 percent, the highest print since 2012. In the meantime, the headline PCE deflator is expected to have accelerated 0.24 percent. This might push the year-on-year headline inflation rate to 1.4 percent, added Societe Generale.

At 06:00 GMT the FxWirePro's Hourly Strength Index of US Dollar was bearish at -84.909. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex