Traditionally, the ECB minutes have contained very little new information

Market movers today

• We face a very thin data calendar, so focus – apart from the ECB minutes – will primarily be on markets evaluating the last days' strong US data and coinciding rally in risky assets.

• Traditionally, the ECB minutes have contained very little new information, however, that was not the case in January where a lot of detail on QE considerations was revealed. This time around an interesting insight could be the degree of diverging views within the governing council. Concerns regarding the QE impact on the German repo levels in particular would also attract market attention.

• In the Scandies focus will be on the Swedish labour market report and on Norges Bank's Governor Olsen's annual address. For more info see ‘Scandi Markets' on page 2.

Selected market news

Yesterday's bunch of US releases were all on the strong side (see below) boosting market expectations of when the next Fed hike is due: we now estimate the implied probabilities at c. 30% for March and 60% for May while markets more than fully price one hike in June and an accumulated 2.3 hikes for 2017. When should we expect the next Fed hike? Arguably recent data has been better-than-expected, but given Yellen's recent communication deferring from talking about a rate hike ‘soon' and instead referring to an ‘adjustment' (singular) of the Fed funds target at the ‘upcoming meetings', we still think June is the most likely time even if March and May have become increasingly probable.

US CPI surprised on the upside with the core measure beating expectations by rising 2.3% y/y. The headline measure also surprised, as the largest monthly headline rise in four years drove the yearly rate to 2.5% resulting in zero real wage growth (measured against average hourly earnings) in January; the first time since June 14. Meanwhile, the coinciding release of January retail sales did not suggest any purchasing power headwinds for consumers, as the control group rose 0.4% m/m with positive revisions. Manufacturing production also confirmed the highest quarterly growth rate in two years.

Despite the monthly Treasury International Capital System (TICS) data revealing that China returned as a net-buyer of US Treasuries in December, the release still confirmed that 2016 marked the largest annual Chinese disposal of Treasuries. China held USD 1.06tn worth of treasuries at the end of 2016 compared to USD 1.25tn one year ago. With a holding worth USD 1.09tn, Japan maintained its position since October as the world's largest owner of Treasuries.

In oil markets, data from the US Energy Information Administration showed that US crude stocks rose 9.5mb last week, i.e. in line with the 9.9mb increase reported in the API data reported Tuesday. Hence, the upwards trend in crude stocks continue. The rise in US crude stocks seen in recent weeks is likely a result of average-to-mild winter weather in the US and thus lower than normal seasonal demand for heating oil and hoarding of oil towards the end of last year in response to the OPEC, non-OPEC decision to cut output.

The monthly labour market report released in Australia gave mixed emotions, as the higherthan- expected employment print was driven by a rise in part time employment, while full time employment fell.

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