The end of last week was marked by tensions in Middle East, and thus, this week, investors may be on the lookout on whether this will escalate further. With regards to the economic agenda, focus could fall on the US and Canadian employment reports for December, as these data sets could reshape market expectations with regards to the Fed’s and BoC’s future course of action. We also get Eurozone’s and Norway’s inflation prints for the month.
Monday appears to be a relatively light day. We get the final Markit services and composite PMIs for December from several Eurozone nations and the bloc as a whole. As it is always the case, the final numbers are expected to confirm their preliminary estimates. The UK’s final prints are also coming out, with both the services and composite indices expected to be revised a tick higher, to 49.1 and 48.6 from 49.0 and 48.5.
On Tuesday, during the European morning, we get Switzerland’s CPI rate for December, which is expected to have remained unchanged in negative territory, at -0.1% yoy. At its latest meeting, the SNB kept interest rates unchanged at -0.75% and reiterated that it remains willing to intervene in the FX market as necessary. That said, since then, the Swiss franc strengthened decently, raising questions as to how willing to intervene the Bank is. A strong franc could work against inflation, and with the CPI rate in negative territory, investors may be on the lookout on whether the Bank will indeed decide to step in soon in order to halt the franc’s advance.
We also get inflation data for December from the Eurozone. The preliminary headline CPI rate is forecast to have risen to +1.3% yoy from +1.0%, while the core one is...
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