We have lots of data today on the agenda although the majority of it is unlikely to change anything in terms of market pricing. In the European session the highlights include the Spain Flash CPI and the Eurozone Q4 GDP and Unemployment Rate. In the American session, the focus will switch to the ECB policy decision and the US Q4 GDP and Jobless Claims.
13:15 GMT/08:15 ET - ECB Policy Decision
The ECB is expected to cut interest rates by 25 bps and bring the policy rate to 2.75%. The recent Eurozone CPI report showed core inflation remaining pretty sticky, especially on the services side.
Moreover, despite all the doom and gloom, the latest Flash PMIs showed a notable rebound in economic activity which might even get stronger if the Russia-Ukraine war gets settled.
Also, news on EU to push AI, advanced research and clean tech in bid to compete with the US and China got louder with pressures to reduce and simplify regulations and increase investment.
There could be a great contrarian trade on the euro in 2025 although the tariffs threats continue to create some noise and uncertainty.
13:30 GMT/08:30 ET - US Jobless Claims
The US Jobless Claims continue to be one of the most important releases to follow every week as it’s a timelier indicator on the state of the labour market.
Initial Claims remain inside the 200K-260K range created since 2022, while Continuing Claims continue to hover around cycle highs although we’ve seen some easing recently.
This week Initial Claims are expected at 220K vs. 223K prior, while Continuing Claims are seen at 1890K vs. 1899K prior.
