Market Movers ahead
- An important meeting is coming up in the Swedish Riksbank, as it has to decide on whether to end QE and it is a close call as to what it will chose.
- Higher wage growth is key if the ECB is to realise its inflation target; therefore, euro area wage data for Q3 due out on Tuesday should be watched closely.
- The most important inflation measure in the US is likely to show slightly higher inflation.
- The Bank of Japan is expected to announce unchanged policy but might comment on recent tightening speculation.
Global macro and market themes
- Recent economic data releases support our view that the global expansion continues, not least in the euro area, where PMIs have been very strong in Q4.
- It is too early for markets to price out Brexit risk just yet, but it is positive that negotiations are moving forward.
- Central bank meetings support our view that global monetary policy tightening will be gradual.
- The environment is positive for risk assets such as equities; we believe EUR/USD will move higher and that yields will stay low.
- Norges Bank will hike rates late next year.
- In the FX space, we look for a weaker USD and a stronger GBP and NOK in 2018.
