Daily Market Report - 12/11/2015

Britain's unemployment rate fell to its lowest level since early 2008 but earnings grew more slowly than expected, showing why the Bank of England is in no hurry to raise interest rates. Britain's unemployment rate dipped to 5.3 percent in the third quarter, its lowest level since the three months to April 2008, before the financial crisis crippled the economy .However, wage growth has not risen as strongly as the Bank projected. Last week the BoE said Britain's near-zero inflation rate would only pick up slowly even if interest rates stayed on hold throughout next year. The Office for National Statistics said the total earnings of workers - including bonuses - rose by 3.0 percent in the three months to September, unchanged from the three months to August. Sterling fell after Wednesday's data release as investors bet it would keep the pressure off the BoE to raise rates, even as the U.S. Federal Reserve heads for a hike possibly as soon as next month.

Both Mario Draghi and Mark Carney spoke in London yesterday but did not touch on UK and EU monetary policy or anything to move the market as the focus was on financial regulation. However, Reuters did report yesterday that the ECB is considering extending its QE programme by purchasing municipal bonds of cities such as Paris or Bavaria. Municipal bonds are debt securities issued by states, cities, counties and other governmental entities that the ECB will now buy to try and stimulate growth in individual areas. Currently the ECB's scheme of QE centers mainly on state bonds, however with the Eurozones economy only growing modestly, the ECB is considering alternative options to improve growth and inflation.

Key Announcements
10:00 – EUR :Industrial Production (MoM) expected to stay the same at -0.5% 13:30 – USD :Initial Jobless Claims expected to fall to 270k from 276k
13:30 – USD :Continuing Jobless Claims expected to fall to 2.16M from 2.163M