Here are the latest developments in global markets:
FOREX: Major currencies were range-bound during the early European session, with the euro being not much stressed ahead of a regional election in Catalonia. Euro/dollar changed hands at 1.1880 around 1000 GMT (+0.09%), while euro/yen edged up to a two-year high of 134.86 (+0. 12%).The dollar was flat versus the yen and the loonie at 113.44 and 1.2829 respectively as the passage of the US tax legislation was already highly priced in the markets. The pound managed to erase most of its earlier losses, rebounding to $1.3380 after the UK government announced dates on the next parliamentary Brexit debates (January 16-17).
STOCKS: European stocks drifted lower despite the passage of the US tax legislation in Congress. The pan-European STOXX 600 was down by 0.18% at 1000 GMT as shares in Steinhoff International Holdings continued to weigh heavily on the index after they touched a fresh record low in early trades today. The Spanish IBEX 35 also lost 0.18% but was in a better position than the German DAX 30 and the French CAC 40 which retreated by 0.20%.
COMMODITIES: Oil prices pulled back on news that the British Forties, one of the largest pipelines operating in the North Sea, would start operations probably in early January. Brent fell by 0.20% to $64.43 per barrel and WTI crude slipped by 0.14% to $58.01. Gold was flat at $1,265.80 per ounce.
Day ahead: Catalonia back to polls; Canadian inflation eyes BOC target
The economic calendar will be pretty busy on Thursday, with the US, Canada and the Eurozone delivering reports ahead of the Christmas holiday. Regional elections in Catalonia will also be in focus today, where pro-independence parties will take the chance to echo their desire to leave Spain. However, in case they draw significant support, that would be another headache for the Spanish government and for the euro itself.
Out of the US, final GDP growth figures are due at 1330 GMT, with analysts predicting the gauge to match second estimates at 3.3% on an annualized basis in the third quarter. This is the highest expansion the economy has experienced in a year.
Meanwhile, final core PCE prices are expected to stand in line with previous estimates at 1.4% y/y in the third quarter.
US initial jobless claims are anticipated to climb by 6,000 in the week ending December 15, while the Philadelphia’s Fed manufacturing index is forecasted to decline by 0.8 points to 21.5 in December.
The focus would also turn to Canada at 1330 GMT, where data on inflation and retail sales are expected to come higher. According to forecasts, the headline CPI Is anticipated to rise by 0.6 percentage points to 2.0% y/y in November, bringing good news to the BOC policymakers who are eagerly awaiting the index to hit this level before they decide to tighten monetary policy even further.
Monthly retail sales are said to expand by 0.3% in October compared to 0.1% seen in September. If true, this would be the highest mark posted since July. The core measure, which excludes volatile items is projected to inch up by 0.1 percentage points to 0.4%.
Elsewhere, flash readings on Eurozone’s consumer confidence will be available at 1500 GMT. After reaching positive levels for the first time since 2001, the measure is now said to come lower at 0 in December.
