European FX Outlook: IMF and Bundesbank joint presser headlines European morning

What you need to know before markets open:

• Chinese economy rose 6.8% in final quarter of 2017, beating the market expectations.
• Bundesbank conference with IMF is the only important event in Europe on Thursday.

Thursday’s market moving events

• Australian employment rose 34.79K new jobs with the unemployment rate ticking up to 5.5% in December.
• China’s retail sales decelerated to 9.4% y/y in December.
• China’s industrial production is expected to slow to 6.0% y/y in December.
• China’s Q4 GDP is expected 6.8% y/y, matching the previous quarter.
• Japan’s industrial production is seen rising 0.6% m/m in November while rising 1.9% y/y.
• German Bundesbank President Jens Weidmann is expected to speak at a joint conference by the International Monetary Fund and the Deutsche Bundesbank, in Frankfurt at 8:00 GMT.
• The US housing starts are seen falling to 1.275 million in December.
• The US building permits are set to decelerate to 1.290 million in December.
• The US weekly jobless claims are expected to reach 250K in a week ending January 12.
• Philadelphia Fed manufacturing index is seen reaching 25.0 in January, down from 26.2 in December.
• ECB’s Cœuré in concluding panel on 'A post-crisis agenda for the euro area and Germany: which way forward?' at joint conference of IMF and Deutsche Bundesbank “Germany – Current Economic Policy Debates” in Frankfurt, Germany at 14:30 GMT.
• EIA crude oil inventories are expected to fall by 3.588 million barrels in a week ending January 12.

Major forex market movers

• The US Dollar index is set to continue in its correction against majors with an empty economic calendar to drive the market sentiment and technicals are set to dominate.

Wednesday’s macro summary

• The Eurozone inflation increased 1.4% y/y while core inflation rose 1.1% y/y in December, both figures coming in line with expectations.
• The Bank of England said it has seen some evidence of the UK lenders tightening consumer credit underwriting standards in 2017, with UK motor finance lenders adopting a "reasonably prudent" approach to the future value of 2nd-handed cars.
• A group of 14 economists from Germany and France is proposing a reform package for the European Monetary Union. Implementing the package would make the euro area more robust and resilient in the face of crisis while ensuring sounder public finances and stronger economic growth.The proposal includes the creation of joint "safe assets".
• The US Industrial production rose 0.9% m/m while capacity utilization increased to 77.9% in December.
• The Bank of Canada increased the policy rate by 25 basis points to 1.25% in line with market expectations but remained cautious in terms of outlook with NAFTA related uncertainty roiling its stance.  
• Bitcoin may half again in value amid current cryptocurrency rout with fall to $5,605-$5,673 area "looking very likely to be very speedy" - Citibank