This morning, UK GDP data came out as expected whilst both manufacturing and industrial production figures surprised the market with better than expected readings. However, the market saw little reaction as the focus was on yesterday evening’s dinner meeting between PM Johnson and European Commission President von der Leyen. The outcome was that both parties remain at a deadlock over key sticking points but agreed to extend talks until the end of the weekend. Overall, the Pound has lost some ground from its highs yesterday.
The ECB interest rate decision and press conference are due in the early afternoon whilst an EU summit is taking place over the course of the day. The market will pay close attention as it is possible that EU leaders could approve a stimulus package worth $2.2 trillion to help Eurozone economies recover from the pandemic. Furthermore, ECB President Lagarde comments on the Euro’s recent appreciation could impact the common currency.
US consumer price index inflation as well as unemployment claims will be released at 1:30pm which is likely to cause some short-term volatility. It is expected that CPI will show a small increase in November with unemployment claims for last week also expected to increase. Although the US is struggling to contain the coronavirus, the Dollar remains weak due to positive vaccine news.