Headlines:
- Major central banks the main focus in the week ahead
- Weekly update on interest rate expectations
- France December flash services PMI 48.2 vs 46.7 expected
- Germany December flash manufacturing PMI 42.5 vs 43.1 expected
- Eurozone December flash services PMI 51.4 vs 49.5 expected
- UK December flash services PMI 51.4 vs 51.0 expected
- ECB's Lagarde: We can cut rates further if incoming data confirms disinflation process
- ECB's de Guindos: We will continue in the same direction as in the past few months
- ECB's Kažimír: Maintaining a gradual approach through 25 bps rate cuts is most prudent
- PBOC says will keep yuan exchange rate basically stable
- Italy November final CPI +1.3% vs +1.4% y/y prelim
- SNB total sight deposits w.e. 13 December CHF 456.4 bn vs CHF 458.8 bn prior
Markets:
- GBP leads, JPY lags on the day
- European equities lower; S&P 500 futures up 0.2%
- US 10-year yields down 2.6 bps to 4.373%
- Gold up 0.5% to $2,662.73
- WTI crude down 1.1% to $70.46
- Bitcoin up 2.5% to $103,940
It's the final real trading week of the year! And what a dull start to proceedings it has been today in European morning trade.
The main focus on the session was the euro area and UK PMI data releases but they didn't do much to impact markets whatsoever.
With traders already largely convinced of an ECB rate cut next month and for the BOE to keep rates on hold this week, there wasn't much for market players to really scrutinise even with a slight beat on the data figures.
The euro barely moved but sterling did nudge a little higher before giving most of that back. EUR/USD kept little changed throughout, holding around 1.0500 with large option expiries in play. As for GBP/USD, the pair moved up to 1.2670 on the PMI data but then gave most of the gains back in a retreat to 1.2645 currently.
Besides that, the dollar was largely little changed against the rest of the major currencies. This as broader markets are keeping more mixed and tentative as well. USD/JPY did move a little higher from 153.70 to 153.95 but 10-year Treasury yields are down 2.6 bps to 4.373% on the day.
In the equities space, European indices are down across the board in continuing the sluggish mood from last week. Meanwhile, US futures are keeping slightly higher but we're yet to get to the US PMI later in the day.
Overall, it's a tentative start to the new week as all eyes are on major central bank decisions. The Fed will be the first in line but that will only come on Wednesday.