W/E: Weekly Support (updated)
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EUROPE
Greek
Presidential Election: Leaders raise fears over euro membership – voxeurop
TLTRO
spoils Christmas holidays at the ECB – Bruegel
The Bank of
Italy warns that any further falls in prices at this stage could have
'extremely grave consequences for economies with very high public debt levels'
Employment
up by 0.2% in the euro area and by 0.3% in the EU28 – Eurostat
Industrial
production up by 0.1% in both euro area and EU28 – Eurostat
UNITED STATES
FOMC
preview: Expect a more hawkish Fed – Nordea
At next
week’s meeting the Fed is likely to appear somewhat more hawkish. Thus, we
expect that the central bank will drop its assessment that the first rate hike
is still a “considerable time” away. In addition, we expect a more hawkish dot
plot. An outcome in line with our expectations should flatten the USD curve and
pave the way for the EUR/USD testing the crucial 1.2220-50 level once more.
Merrill
and Nomura: FOMC Preview – Calculated
Risk
Likely
unlikelies 2015: The Fed hike cycle – the long waiting game to continue? – Nordea
Patience is
a virtue, and one that is and has been needed on US rates. The Fed stands
likely to hike in 2015, but for investors the question is not only whether
rates will increase, but if they’ll beat the forwards. Paying in short swaps has
been a steady loser over the past 1½ years, and the roll against remains
strong. We favor longer exposure. We argue that the Fed might be delayed
further due to lack of inflation pressure, a cautious bias, and considerations
regarding market volatility.
Data
Supportive of Fed Plans – Tim
Duy’s Fed Watch
I would
like a journalist to press Yellen on her interpretation of the 5-year, 5-year
forward breakeven measure of inflation expectations. Does she see this measure
as important or too noisy to be used as a policy metric? What is her preferred metric?
Preliminary
December Consumer Sentiment increases to 93.8 – Calculated
Risk
Confidence
Surges to New Post-Recession High – WSJ
ASIA
Japan:
Abenomics gets a second chance – Nordea
Japan’s
general election on Sunday is likely to extend Shinzo Abe’s premiership for
four more years. The market has priced in a landslide victory to the ruling
coalition, so no market reaction is expected. Abe needs to allocate more
political capital to structural reforms if he does not want Abenomics to be
remembered as an expensive failure.
China:
industrial production remains weak but domestic demand stabilising – Danske
Bank
OTHER
Daily
Central Banks – WSJ
Hilsenrath’s
Take: How to Size-Up a Mixed U.S. Record on Deleveraging * WSJ Survey:
Economists Stick to Mid-2015 Fed Rate Hike View * Fed Finds Americans’ Wealth
Dips Amid Stock Volatility * Bank of Canada Chief Warns on Impact Of Financial
Reform, Oil Prices * Chinese Banks Step Up Lending to Offset Slowing Growth
Daily
Macro – WSJ
Oil prices
are once again front and center for markets today, with prices dropping below $60
a barrel after the International Energy Agency produced a pessimistic
assessment of the outlook for world crude demand. The worrying thing about this
report from the IEA – and others earlier this week from the U.S. EIA and OPEC –
is that it underscores the demand component of the oil price rout.
Danske
Daily – Danske
Bank
Nordea
Morning – Nordea
FI
Eye-Opener: What more could you possible need? – Nordea
German
10-year yield with new lows again – longer US yields fail to rise. Greek yields
continue to surge higher, while Greek equities hit hard. Some profit taking
ahead in core bonds today. Euro-area inflation expectations hitting new lows.
Oil prices down. Chinese economic data mixed. Not nearly enough – QE coming. US
economy continues to do well – House narrowly passes spending bill. Norges Bank
cuts, while Russia hikes, due to plunging oil prices. Possible French downgrade
ahead
Dollar
Consolidates as Oil Slide Continues – Marc
to Market
US Open – ZH
Crude Drops,
Yields Slump, Futures Tumble
From the
floor – TradingFloor
WTI crude
heads below $60/barrel as prices plunge 20% since Opec meeting * Shale discount
to WTI sees West Canadian Select at the $40/b mark * Market shakeout at margins
making Chapter 11 announcements more likely * EURNOK 1-month atm offering
"long value", says Norup * Hansen says watch XAUEUR as it gets close
to breaking €1,000/oz level * Hardy makes USDJPY trade call ahead of Japanese
election
Global:
has the Fed's unprinting been impacting markets? – Nordea
The Fed’s
test-driving of various facilities has led to a sharp drop in excess liquidity
in recent months, something we’ve nick-named Quantitative Tightening. This may
have been one driver of dollar strength and disinflationary markets this
autumn. If the Fed finds a way to control money market rates without absorbing
as much liquidity, markets would “only” have to deal with a Fed seemingly
dead-set on hiking rates by the middle of 2015
FX 2015,
now with more hyperbole – FT
2015
Outlook: Global Banks
– Moody’s
Economic
challenges and regulatory reforms continue to test stability (free reg. required)
FINNISH
Aamukatsaus – Nordea
Alhainen öljyn hinta saa keskuspankin laskemaan Norjassa ja
nostamaan Venäjällä | Isompi, muttei kuitenkaan riittävä | USA:n
vähittäismyynti hyvässä vedossa
Yhteiskuntasopimus ja Saariselän sheriffit – Elina
Lepomäki / US
Sisäpiirikirja kertoo Venäjän johtamisesta
valhesirkuksella – Verkkouutiset
Kremlin valtaotteen synnyttämisen nähnyt brittituottaja
kertoo uskomattomia tarinoita Venäjän johtamisesta tositelevisiona.
Nyt yskii vähittäiskauppa pahasti – Kesko ja Stockmann
huikeassa alamäessä – Verkkouutiset
”Hallituksen talouspolitiikka väärillä urilla, Suomelle
laadittava kansallinen pelastusohjelma” – PS