Weekly Global Market News – Dec 15 Week Ahead: Rates,...
Read MoreWeekly Global Market News – Dec 15
Week Ahead: Rates, inflation and jobs take center stage
Overview
A packed macro week will see three major central banks set policy, fresh inflation prints across multiple regions and a run of employment data. Markets will be parsing signals on how far the global easing cycle has to run in Europe and the UK, and whether Japan edges further away from ultra‑loose policy. Corporate news flow is busy too, with bellwether results in tech, logistics, consumer and travel.
Top themes to watch
1) Central banks: BoE, ECB, BoJ
- Bank of England (Thu): A 25bp trim to 3.75% is widely expected after October GDP contracted 0.1%. The statement, vote split and guidance will be the market movers. Key questions: is this the last cut for a while, and how concerned is the MPC about sticky services inflation? Watch GBP front‑end gilts and the belly of the curve; a dovish vote split and soft CPI could bull‑steepen gilts. A more hawkish tone (limited room for further cuts) would support GBP.
- European Central Bank (Thu): Broadly expected to hold. Officials have recently framed inflation risks as more balanced. November HICP (Wed) is seen a touch higher at around 2.2% y/y, which should reinforce a steady hand. Market focus: staff assessment of growth/inflation balance, any hints on the pace of balance‑sheet runoff in 2026, and whether the door stays open to cuts next year. Watch EUR rates and periphery spreads.
- Bank of Japan (Fri): Decision is finely balanced, with odds tilted slightly toward another step away from negative/near‑zero rates following recent commentary from Governor Ueda. A move would have global spillovers: a firmer JPY, upward pressure on global yields, and potential headwinds for carry trades. If the BoJ stands pat, expect relief in carry and a softer yen near term. Also watch Friday’s Japan CPI.
2) Inflation and employment data
- UK (Wed): CPI/PPI for November. Services inflation and core momentum matter most for MPC reaction. Friday brings UK retail sales, public finances and the latest banking sector regulatory capital snapshot.
- Eurozone (Wed): Final HICP for November alongside Monday’s October industrial production. Any upside surprise in core would complicate the ECB’s hold‑for‑now stance.
- US (Tue/Thu/Fri): November employment report arrives Tuesday (re‑scheduled), followed by Thursday’s real earnings and CPI (revised release), plus Friday’s University of Michigan sentiment. Given recent shutdown delays, revisions could carry extra weight for the Fed’s growth/inflation mix.
- Canada (Mon): November CPI – important for the BoC’s early‑2026 path.
- Japan (Mon/Fri): Tankan survey (Mon) will color growth and capex expectations; CPI (Fri) anchors BoJ decision risk.
- Australia (Thu): Labor force data could tweak RBA expectations at the margin.
- Mexico and Norway (Thu): Policy decisions that feed into EM FX and Nordic rates.
3) Politics and policy risks to headline tape
- Berlin talks on Ukraine (week): Germany’s Chancellor Friedrich Merz hosts UK PM Sir Keir Starmer, France’s President Emmanuel Macron and potentially a US delegation to explore peace options. Any signals on funding and security guarantees could briefly swing EU risk sentiment.
- UK domestic calendar: The Prime Minister faces a Liaison Committee grilling Monday on delivery against the government’s “plan for change.” The British Medical Association will report Monday on doctors’ industrial action; a five‑day strike in England from Wednesday is possible. Health Secretary Wes Streeting appears before MPs on Wednesday.
- EU Council (Thu–Fri): Leaders meet in Brussels; watch for budget, defense and enlargement headlines.
- Trade and global forums: WTO General Council (Tue); Mercosur Summit (Sat), with the EU–Mercosur deal back in view.
Earnings and corporate highlights
- Tuesday: Hollywood Bowl (FY), IG Group (trading update), SThree (FY trading update)
- Wednesday: General Mills (Q2), IntegraFin (FY), Lennar (Q4), Micron Technology (Q1), Serco (pre‑close)
- Thursday: Accenture (Q1), CarMax (Q3), Cintas (Q2), Currys (HY), Darden Restaurants (Q2), FedEx (Q2), Nike (Q2). Also noteworthy: court sanction expected for Alphawave IP’s acquisition by Qualcomm.
- Friday: Carnival (Q4), ConAgra Brands (Q2), Lamb Weston (Q2), PayChex (Q2), WHSmith (FY) – investors will look for clarity after the company flagged more time was needed to finalize accounts.
Trading playbook by asset class
• Rates
- UK: A 25bp cut is largely priced. Dovish risks: softer CPI and a wide pro‑cut majority could flatten the front end. Hawkish risk: “pause after this cut” language re‑steepens.
- Eurozone: Hold + balanced inflation messaging keeps Bunds range‑bound; periphery sensitive to any balance‑sheet hints.
- Japan: A hike/less‑accommodative tilt lifts JGB yields and can ripple into USTs/Bunds. No change likely bull‑flattens JGBs.
• FX
- GBP: Direction tied to MPC tone and CPI. Dovish cut could push EUR/GBP higher; hawkish hold‑open may support cable.
- EUR: Steady ECB and marginally firmer HICP favor consolidation; EUR sensitive to periphery spreads and global risk tone.
- JPY: Asymmetric risk around BoJ – policy tightening or guidance upgrade supports yen broadly; no change keeps JPY soft but vulnerable into year‑end rebalancing.
- USD: Jobs/CPI revisions and Fed‑speak cadence drive DXY. Soft data plus firm risk appetite tends to weigh on USD; risk‑off or stronger labor data supports it.
• Equities
- Europe/UK: Rate stability plus cooling inflation is constructive for duration‑sensitive sectors (quality growth, staples), while banks track curve moves. UK domestics react to retail sales and consumer sentiment; BoE guidance key for housebuilders.
- US: Micron, FedEx and Nike offer signals on semis cycle, global trade/parcel volumes, and consumer demand mix into 2026.
- Japan: Stronger JPY on BoJ tightening is a headwind to exporters but can boost domestic defensives.
• Credit
- Steady ECB and a well‑telegraphed BoE cut are supportive for spreads; watch periphery and HY for sensitivity to growth downgrades. Corporate results (FedEx/Nike) will guide consumer and logistics credit tone.
• Commodities
- Macro‑driven week: global PMIs and policy outcomes likely dominate energy/metals via growth expectations; watch USD path for gold.
The week at a glance (selected)
MONDAY
- OECD: G20 GDP growth report
- Canada: November CPI
- EU: October industrial production
- Japan: December Tankan business survey
- UK: Rightmove House Price Index
TUESDAY
- Global: S&P Global flash PMIs (Eurozone, France, Germany, India, Japan, UK, US)
- UK: December labor market report; UK Finance card spending stats
- US: November employment report (revised release)
- Canada: BoC Governor Macklem speaks (Montreal)
- Corporate: Hollywood Bowl (FY), IG Group (TU), SThree (FY TU)
- Holiday: South Africa Day of Reconciliation (markets closed)
WEDNESDAY
- Eurozone: November HICP (final)
- UK: November CPI and PPI
- US: NY Fed President John Williams speaks
- Corporate: General Mills (Q2), IntegraFin (FY), Lennar (Q4), Micron (Q1), Serco (pre‑close)
THURSDAY
- Rates: ECB, BoE, Mexico, Norway decisions
- Australia: November labor force
- US: November real earnings and CPI (revised); Conference Board Employment Trends
- Corporate: Accenture (Q1), CarMax (Q3), Cintas (Q2), Currys (HY), Darden (Q2), FedEx (Q2), Nike (Q2)
- M&A: Alphawave IP–Qualcomm transaction expected to become effective (subject to Court sanction)
FRIDAY
- Japan: Policy decision; November CPI
- Germany: Q3 services PPI
- UK: November retail sales; public sector finances; HMRC tax receipts summary
- US: University of Michigan consumer sentiment
- Corporate: Carnival (Q4), ConAgra (Q2), Lamb Weston (Q2), PayChex (Q2), WHSmith (FY)
Risk reminders
- Central bank surprises (vote splits, guidance) can drive outsized moves at the front end of curves and in FX.
- BoJ outcome is a two‑way risk for global rates, carry and yen crosses.
- Data revisions (US CPI/jobs) carry unusual signaling weight following recent delays.
- Liquidity can thin into the holidays, amplifying intraday volatility.
This material is provided for information only and does not constitute investment advice or a recommendation to buy or sell any security or to adopt any investment strategy. Markets can move quickly around economic releases and policy decisions; consider position sizing and risk controls accordingly.
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