US CPI run up:
- US inflation the main event in trading today
- Inflation data today to help keep the Fed status quo?
- Fed rate cut in March too soon but remains a possibility - BofA
- Impact of US CPI data to near-term monetary policy outlook should be limited - Nomura
Headlines:
- UK November payrolls change -12k vs 33k prior
- Germany December ZEW survey current conditions -77.1 vs -76.0 expected
- Germany November wholesale price index -0.2% vs -0.7% m/m prior
- US November NFIB small business optimism index 90.6 vs 90.7 prior
- China says will consolidate and enhance economic recovery
- China confirms that it held its annual Central Economic Work Conference this week
Markets:
- JPY leads, USD lags on the day
- European equities mixed; S&P 500 futures up 0.1%
- US 10-year yields down 5 bps to 4.189%
- Gold up 0.3% to $1,988.03
- WTI crude down 0.6% to $70.89
- Bitcoin up 1.9% to $41,882
It was a quiet session understandably as markets are waiting on the US CPI data later. However, the dollar sagged alongside bond yields as traders are perhaps pre-conceiving what might transpire when we get to the key risk event later today.
The yen was the main beneficiary with USD/JPY falling from around 145.50 in Asia to 145.15 currently, down 0.7% on the day. EUR/USD is also seen up slightly by 0.4% to 1.0800 while AUD/USD is up 0.3% to 0.6585 since earlier in the day.
The pound is a little less enthused after a slightly softer UK jobs report, which reinforces a further pause by the BOE and perhaps even rate cut expectations for the middle of next year. GBP/USD dipped from 1.2580 to 1.2550 before keeping around 1.2560-70 levels now.
In the equities space, stocks are not too excited as investors are waiting on the inflation numbers later before committing to anything.
We're about 30 mins away now, so strap yourselves in. This is where the week finally begins.
