Weekly Focus - Rejection of Brexit deal and ECB ends QE programme

Market Movers ahead

  • We expect the ECB to officially end the QE programme when it meets next week.

  • Flash PMIs for the US, Japan and euro area are due for release next week. In particular, the euro area PMIs are interesting given the negative momentum in Europe right now.

  • In the US, CPI inflation and retail sales data for November are due. Fed's blackout period starts ahead of the FOMC meeting in the week after next.

  • In the UK, the vote in the House of Commons on Theresa May's Brexit deal takes place on Tuesday. More than 400 MPs have said they will vote against the deal.

  • In Denmark and Sweden, inflation data for November are due out next week.

  • In Norway, we expect Norges Bank to stay on hold on Thursday but we expect the bank to confirm its plans to tighten monetary policy further in March.


Weekly wrap-up

  • Global economic key figures were slightly stronger than expected this week.

  • The US and China agreed on a 90-day ceasefire in the trade war.

  • Italy negotiations with the EU are ongoing on the size of the budget deficit.

  • Stock markets had a volatile week as the rally following the trade war ceasefire fizzled out on renewed uncertainty.

  • US 10Y Treasury yields fell sharply on growth fears and uncertainty over the trade agreement. In euro periphery markets we saw spread tightening on softer signals from the Italian government.

  • USD/CNY saw the biggest two-day decline since 2005.

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