Headlines:
- UK November CPI +5.1% vs +4.7% y/y expected
- London's lagging vaccination rate could serve as omicron hotbed
- US MBA mortgage applications w.e. 10 December -4.0% vs +2.0% prior
- US House approves $2.5 trillion debt ceiling increase
- China authorities audit Evergrande, say no fire sale or bailout needed for now
- Spain November final CPI +5.5% vs +5.6% y/y prelim
- France November final HICP +3.4% vs +3.4% y/y prelim
Markets:
- AUD leads, JPY lags on the day
- European equities mostly higher; S&P 500 futures flat
- US 10-year yields up 1.4 bps to 1.453%
- Gold flat at $1,770
- WTI down 1.1% to $69.95
- Bitcoin down 1.2% to $47,722
It was basically a snoozefest in European trading today as the market keeps its focus on the FOMC meeting later today.
UK inflation jumped to its highest since 2011 and that gave the pound a light jolt. However, there wasn't anything else for markets to work with during the session.
European indices are up slightly on the balance of things but the overall risk mood remains more tentative. US futures are flattish as investors await the Fed decision. The bond market also is not hinting at much, waiting on the key risk event later.
In FX, cable jumped a little from 1.3245 to 1.3280 in the aftermath of the hot UK CPI report but is giving most of that back now to 1.3250 levels. Meanwhile, the aussie is holding a decent bounce off 0.7100 to 0.7130-40. But outside of that, there isn't anything interesting as other dollar pairs remain little changed in general.
In the commodities space, gold is also not doing much as all eyes are on the Fed. Elsewhere, oil is down 1% to test $70 as omicron worries continue to reverberate in the background.
In any case, it's all about the Fed today and so the countdown continues for now.
