The main event in the European session was the UK employment report. The data was much better than expected, especially on the wage growth side, and the GBP got a boost from that. In terms of market pricing it shouldn't change much as the BoE is widely expected to keep the Bank Rate unchanged this week. In the American session, the Canadian CPI and the US Retail Sales will take the spotlight.
13:30 GMT/08:30 ET - Canada November CPI
The Canadian CPI Y/Y is expected at 2.0% vs. 2.0% prior, while the M/M figure is seen at 0.1% vs. 0.4% prior. The Trimmed-Mean CPI Y/Y is expected at 2.6% vs. 2.6% prior, while the Median CPI Y/Y is seen at 2.4% vs. 2.5% prior.
The BoC recently
dropped the line saying “if the economy evolves broadly in line with our latest forecast, we expect to reduce the policy rate further", which suggests that we reached the peak in "dovishness" and the central bank will now switch to 25 bps cuts and will slow the pace of easing.
13:30 GMT/08:30 ET - US November Retail Sales
The US Retail Sales M/M is expected at 0.5% vs. 0.4% prior, while the ex-Autos M/M measure is seen at 0.4% vs. 0.1% prior. The focus will be on the Control Group M/M figure which is expected at 0.4% vs. -0.1% prior.
Consumer spending has been stable which is something you would expect given the positive real wage growth and resilient labour market. We’ve also been seeing a strong pickup in consumer sentiment/confidence reports which suggest that consumers’ financial situation is stable/improving.
Central bank speakers:
- 09:00 GMT - ECB's Rehn (neutral - voter)
This article was written by Giuseppe Dellamotta at
www.forexlive.com.
