Drivers for the Week Ahead

Blog icons-DRIVERS

  • The Federal Reserve raised interest rates and the median Fed forecast was for three more hikes next year
  • The recent string of economic data suggests that the synchronized economic expansion in the US, Europe, and Japan is strengthening as the year winds down
  • The Riksbank and BOJ meet in the week ahead
  • We do not think the widening of the cross-currency basis swap in the dollar’s favor is much more than a particularly intense bout of year-end funding needs
  • EM FX is being led higher by ZAR

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UK Front and Center, but Sterling is Laggard in Today’s Move Against the Dollar

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  • The US is a little  heavier against most of the major and emerging market currencies
  • Equities are mixed, European bonds yield are firmer, while US Treasuries are little changed
  • Sweden and UK reported higher than expected CPI
  • Emergency repairs to the UK Forties Pipeline has pushing up Brent prices
  • S&P cut Colombia’s credit rating to BBB- from BBB

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Brexit Talks Move to Stage II, Greenback Remains Firm

Brexit EU and UK Boxing Gloves

  • Negotiations of the separation between the UK and EU will be allowed to enter the second stage 
  • The UK economic data were mixed 
  • China reported a larger than expected November trade surplus, bolstered by a surge in exports 
  • The US reports the November jobs data; late yesterday, Congress extended the spending authorization until December 22 
  • Brazil IPCA inflation rose 2.80% y/y in November vs. 2.88% expected 

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