Market themes of the Day: German and UK inflation headlines day after Brexit deal historic failure

What you need to know before markets open
Main themes:

• The Brexit deal was rejected by lawmakers by a crushing margin of 230 votes on Tuesday, leaving the plethora of options open including disorderly Brexit or no Brexit at all.
• The opposition Labor party leader Jeremy Corbyn is set to trigger a no-confidence vote to the government of Theresa May on Wednesday the vote expected at around 19:00 GMT.
• Regional Federal Reserve President of Dallas and Kansas City both confirmed the “patience” language introduced by the chairman Jerome Powell two weeks ago.
• The UK inflation is expected decelerate in December as the oil prices dropped sharply in the final quarter of 2018. For more detail read my UK Inflation Preview here.                                                                                                                                                           

Europe

• The Eurozone trade balance reached better than expected surplus of seasonally adjusted €15.1 billion in November. 
• The ECB President Mario Draghi in the European Parliament said that most of the challenges in the economy are global and need to be addressed using common policies at the global level. Draghi also reminded that not all of the benefits of the common European currency are fully realized. 
• German inflation is expected to remain stable at 1.7% over the year in January 

UK

• The Brexit deal vote was rejected by lawmakers by a crushing margin of 230 votes on Tuesday, leaving the plethora of options open including disorderly Brexit or no Brexit at all.
• The opposition Labor party leader Jeremy Corbyn is set to trigger a no-confidence vote to the government of Theresa May on Wednesday.
• The Bank of England Governor Mark Carney is scheduled to testify, along with three Financial Policy Committee members, on the Financial Stability Report before the Treasury Select Committee at 9:15 GMT.
• The UK inflation is expected to have decelerated to 2.1% over the year in December as the oil prices dropped sharply in the final quarter of 2018. For more detail read my UK Inflation Preview here.    

US

• Empire State manufacturing index fell to 3.9 in January down from 10.9 in the previous month. 
• The US core PPI remained unchanged rising 2.7% over the year in December. 
• Kansas City Federal Reserve Bank President Esther George and a voting member of the FOMC said “it might be a good time to pause” on rate hikes.
• Dallas Federal Reserve President Robert Kaplan said that patience on interest rates should last at least a quarter or two, and should be a matter of "months" not weeks. He added that a call for patience does not necessarily mean the Fed should stop raising rates altogether.
• The Federal Reserve Bank is set to publish the Beige book analysis of the economic activity and development.