Following a busy week, with Brexit staying on center stage and three G10 central banks (the ECB, the SNB and the Norges Bank) deciding on monetary policy for the last time this year, this week looks very eventful as well. Four more G10 Banks are holding their last meetings for 2018: The Fed, the BoE, the BoJ and the Riksbank. The Fed is widely anticipated to raise interest rates, with market participants on the edge of their seats, awaiting for the updated “dot plot”. We expect all the other Banks to stand pat, although given its guidance, there is the chance for a hike by the Riksbank.
Monday is a relatively light day, with the only release worth mentioning being Eurozone’s final CPIs for November. The final numbers are expected to confirm the preliminary ones and show that both the headline and core inflation rates declined to +2.0% yoy and 1.0% yoy from +2.2% and +1.1% respectively.
On Tuesday, during the Asian morning, the RBA releases the minutes from its latest monetary policy meeting. At that gathering, the Australian central bank decided to keep once again its benchmark interest rate unchanged at +1.50%, and although the accompanying statement included some more optimistic tweaks, the market reaction was far from suggesting a big change in market expectations with regards to a hike by this Bank. According to its latest quarterly Statement on Monetary Policy, the cash rate is expected to increase in 2020, and recent comments by RBA Deputy Governor Guy Debelle added more credence to the view that this Bank has still a...
Read the full financial markets weekly outlook on JFD Research.