It is time for the German Ifo business confidence
|Market movers today
-
Today, it is time for the German Ifo business confidence. We expect to see a small decline again on the back of a continued difficult external environment, with China slowing further into year-end. See also Germany - Not out of steam, but past the peak , 11 December 2018 for more on our expectations on the German economy.
-
US housing starts will give more flavour on the state of how much US housing is slowing down. A range of housing indicators (permits, house prices, home sales, NAHB survey) have all weakened over the past six months.
-
In China, President Xi Jinping is scheduled to give a speech in Beijing to mark the 40-year anniversary of the reform and opening policy, started by Deng Xiaoping in December 1978.
-
Otherwise, markets will be looking ahead to the Fed meeting tomorrow for signals of monetary policy in 2019.
Selected market news
It is beginning to look like investors have been naughty this year as Santa Claus continues to be ever delayed. Risk tumbled in the US after European bourses closed. The S&P 500 fell over 2% to its lowest level year to date. Asian exchanges followed suit. US 10-year treasuries held steady around 2.86%. The dollar held against other currencies. This morning, S&P 500 stock futures are trading unchanged.
Yesterday, Trump warned the Fed about raising rates. He said that it is 'incredible that with a very strong dollar and virtually no inflation', the Fed is even considering raising rates given that at the same time 'the outside world is blowing up' and 'Paris is burning'. Markets continue to expect the Fed to raise interest rates as it convenes tomorrow despite Trump's guidance over the 'madness' of raising rates amidst global carnage. We concur.
Never a dull day in Brexit land. Yesterday, PM Theresa May indicated that the vote on her Brexit deal will take place in the week beginning 14 January. May also said that negotiations with the EU continue despite the EU having said that no further negotiations are planned and that the EU27 will not reopen the Withdrawal Agreement. It seems as if EU leaders will not change position until at least the UK politicians find out what they want. This makes good sense as it is not a given that the deal would survive in the House of Commons even with further concessions given the big divisions in British politics.
Also yesterday, UK Labour leader Jeremy Corbyn said he wanted to proceed with a 'no confidence' vote in May. The vote would not be on her government, which could lead to snap elections. Instead, a vote solely on May would have limited legal implications besides the potential embarrassment for Theresa May.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.