Sat, Nov 27, 2021 @ 19:39 GMT
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Weekly Focus: From Symbolic to All-Out Trade War?

Market Movers ahead

  • We do not expect recent developments on trade to evolve into an all-out trade war, but to remain largely verbal. However, the central theme will be if the US takes further steps against China and the potential for escalation.
  • US core CPI will come down after a number of stronger-than-expected releases.
  • In China, we expect data for industrial production, retail sales and fixed asset investments to confirm the picture of a moderate slowdown.
  • Euro area wage growth is expected to remain around the current level.
  • In Sweden, inflation will rebound somewhat but remain below the Riksbank’s forecast. We expect house prices in Stockholm to have increased in February, as purchases moved forward prior to new amortisation rules taking effect in March.
  • In Norway, the main event is, of course, the rate-setting meeting at Norges Bank, where we expect the rate path to be revised up a little.

Global macro and market themes

  • The ECB shrugs off political risks and moves on unabated.
  • Eurosceptic win in Italy leaves political risk premium in EUR and Italian bonds under pressure.
  • The ECB manages to deliver ‘hawkish’ shift in guidance in a soft tone.
  • Trump’s trade rhetoric is yet another USD negative to add to ‘the list’.

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