GBP
The Bank of England’s financial policy committee said yesterday that it’s
worried that the fall in crude prices could fuel geopolitical risks. They also
point out it could also drive the Eurozone closer to deflation. This is
relevant in many economies in Eurozone where core inflation is already weak.
Low headline readings would further depress expectations of future inflation.
This, in turn, could result in slower rates of growth of nominal incomes,
increasing the burden of existing debts.

GBP
The Bank of England’s financial policy committee said yesterday that it’s
worried that the fall in crude prices could fuel geopolitical risks. They also
point out it could also drive the Eurozone closer to deflation. This is
relevant in many economies in Eurozone where core inflation is already weak.
Low headline readings would further depress expectations of future inflation.
This, in turn, could result in slower rates of growth of nominal incomes,
increasing the burden of existing debts.

USD
The US housing market recovery is starting to look a little rocky. After two
consecutive months of increases, sales of existing homes fell to a six month
low in November. The National Association of Realtors said they dropped 6.1% to
an annual rate of 4.93m units. The forecast was a figure of 5.2m. October’s
sales rise was revised slightly down from 5.26m units to 5.25m.

EUR
Consumer confidence in the Eurozone came in slightly better than expected
yesterday, although still in negative territory. According to an initial
estimate from the European Commission, consumer confidence in the eurozone rose
to -10.9 from a revised -11.5 in November. Analysts had been expecting a figure
of -11.

RUB
Russia’s immediate financial crisis eased a little today; the rouble has
strengthened by almost 6%, and the Russian stock market jumped by 8%.
However Russia’s unfolding financial crisis has claimed its first victim.
Mid-size lender Trust Bank is being bailed out with 30bn roubles from the
Central Bank of the Russian Federation. It appears that, during the good times,
Trust offered attractive savings rates and consumer loans. That helped it
expand while the Russian economy was ticking along. But the rouble crisis, and
the shock caused by Western sanctions, has hit demand for credit and left some
borrowers unable to repay their debts.

Key Announcements:

GBP – 09:30 – GDP (YoY) expected to fall to 3% from 3.2%
USD – 13:30 – GDP Annualised  expected to fall to 4.1%  from 4.6%
USD – 13:30 – US Durable Goods orders (Nov) expected to rise 1.8% from 0.4%

Our dealers are available via e-mail ([email protected]) or by phone (020 7220 8181).