What you need to know
- The UK Brexit Minister Davis said the government decided to leave the EU customs union without assessment analysis as free trade agreements carried out by countries like Switzerland were much more beneficial.
- The US ADP private employment report considered the best proxy for the US government’s labor market report due on Friday is expected to see 185K new jobs added in November.
- The Asian and European equity markets fell on Wednesday as year-end profits are booked.
Wednesday’s market moving events
- The US ADP private employment is expected to rise 185K in November, less than 235K in October. The ADP employment report is a forerunner of government’s labor market report due on Friday.
- US Q3 unit labor costs are seen rising 0.2% q/q while Q3 labor productivity is expected to rise 3.3% q/q.
- The Bank of Canada is expected to hold rates steady at the monetary policy meeting.
- EIA crude oil inventories are seen falling by -3.507 million barrels.
Major market movers
- Sterling is moving lower against the US Dollar as the Brexit negotiations are getting tense before the EU summit on December 15.
- The US Dollar is a straightforward beneficiary of US tax reform, should the progress move forward further.
Earlier in Asia/Europe
- German factory orders rose 0.5% m/m in October while rising 7.0% over the year.
- The Eurozone retail PMI rose to 52.4 in November from 51.1 in October with sales growing on an annual basis.
- ECB Executive Board member Yves Mersch said that if the monetary stimulus is removed prematurely and too quickly, asset prices could collapse and yields rise sharply with the ECB aware that the longer the program lasts, the greater the risks. In his opinion, it will no longer be necessary to buy assets as a result of existing forces in due course.
- The UK Brexit Minister Davis said the UK government decided to leave the European Union’s customs union without first undertaking a quantitative assessment of the impact of such a decision.
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