Data the focus ahead of Central Banks – ANZ

By FXStreet FXStreet (Bali) – The Research Team at ANZ reviews the action from Monday, while adding that it is ‘waiting time’ until Central Banks, including the Fed and ECB, may much awaited big calls during December.

Key Quotes

“With markets biding their time until central banks deliver their verdict on the policy outlook, the focus remains the tone of the data.”

“Eurozone PMIs were generally stronger than expected and partly a consequence of accommodative financial conditions in place.”

“Whether or not this will be sufficient to prevent further ECB easing next week remains to be seen, but Draghi’s weekend comments suggest the ECB is likely to act given the considerable degree of spare capacity in place and perceived downside risks to the activity and inflation outlook.”

“Despite weaker than expected US data overnight, market odds of a December hike are currently 74%, with markets interpreting the unscheduled Fed meeting to consider the discount rate as a signal for future moves on the Fed funds rate (more details on page 2).”

“Despite this, Treasury yields remain reasonably low despite their nudge up in recent weeks. Equity markets appear to be taking the prospect of Fed lift-off in their stride, taking reassurance from Fed signals of a gradual …read more

Source:: FX Street