Market Movers ahead
In the euro area all eyes will be on the EU-summit on Monday, where the main focus is expected to be the fiscal pact and Greece. However, without a conclusion on the PSI negotiations, it will be difficult to make progress with Greece.
In the US we expect the rise in non-farm payrolls to have eased slightly (135K in January from 200K) partly due to seasonal factors. ISM manufacturing is expected to continue to edge higher in January.
In Japan data are expected to confirm that the activity rebounded in December, but it will not be enough to compensate for an overall dismal Q4.
In Norway and Sweden the manufacturing PMIs are expected to rebound slightly in January in line with already released flash PMIs from the Euro area.
Global Update
The Fed statement was surprisingly dovish in light of recent encouraging US data. We now do not expect Fed to hike the fed funds rate until mid-2014.
In the euro area better-than-expected PMIs suggest that the recession will be relatively mild.
Japan’s trade balance showed a deficit for 2011 as a whole and the current account surplus appears to be disappearing faster than expected. This development makes Japan more vulnerable to spill over from the debt crisis.
In Sweden both trade balance and retail sales point to a marked slowdown in growth in Q4.
