Good Morning Traders! This Thursday we get German Industrial Production and Eurozone GDP.
Here is what to expect.
Sentiment
Because of remarks made by Governor Kazuo Ueda and one of his deputies, traders now view the Bank of Japan's December policy meeting as a "live" event that could affect bets in the currency and interest rate markets. At one point on Thursday, overnight-indexed swaps indicated that there was an approximately 45% probability the Bank of Japan would abandon its negative interest rate policy this month. Deputy Governor Ryozo Hi mi no's comments on Wednesday were recognised as a major factor in this decision.
The Bank of Japan's 2% target for inflation is considerably exceeded by the inflation figures, but BOJ Governor Kazuo Ueda tells parliament that the inflationary trend has not yet stabilised above the level. A measure of demand for Japan's 30-year national bonds reached its lowest point since 2015 due to a lacklustre response from investors.
China's imports unexpectedly decreased in November compared to the same month a year earlier, dashed hopes that the country's flagging economy would see growth from its low base of domestic demand.
The majority of a five-day losing streak for oil kept prices down, sending them to their lowest point since June despite OPEC+'s intentions to limit production through 2024.
In yet another external appointment to the RBA, the Reserve Bank of Australia said that Sarah Hunter will leave the Treasury to take up the position of assistant governor and chief economist beginning next month.
On Wednesday, the Treasuries market continued its upward trend, as a deceleration in the creation of private-sector jobs incentivized traders to place bets on US interest rate decreases ahead of the release of comprehensive labor-market data on Friday.
This week saw the greatest level of demand for a seldom utilised Federal Reserve facility since 2020, which may indicate that some banks are preparing for upcoming liquidity constraints as the central bank's balance-sheet disposal continues.
Docket
02:00 AM ET
German Industrial Production YoY SA
Median Forecast -3% | Prior -3.86% | Range -2.2%/-3.7%
German Industrial Production MoM
Median Forecast 0.2% | Prior -1.4% | Range 1.0%/-0.6%
05:00 AM ET
Eurozone GDP Revised YoY
Median Forecast 0.1% | Prior 0.1% | Range 0.1%/0.1%
Eurozone GDP Revised QoQ
Median Forecast -0.1% | Prior -0.1% | Range -0.1%/-0.2%
Speakers
02:45 AM ET
ECB's Holzmann Speaks
Good Luck Today Traders!
