In the United Kingdom, the appearance of a new strain of highly contagious Covid-19 virus adds on the uncertainties of a Brexit deal. The 10-year Gilt yields this morning have broken their support line at 0.20%, and they are descending towards the 0.10% benchmark bank rate. Last Friday Vlieghe, a BOE MPC member, said that the UK might need subzero rates for a full recovery. That's why in the next few weeks if a Brexit deal is not signed and the Covid-19 situation worsens we could see 10-year yields dipping below 0.10%.
In terms of data, we have gross domestic product figures coming out from several countries, which can also contribute to sovereign sentiment if they are worst than expected.
In conclusion, don't get too comfortable with the Christmas lull this year as it seems that the market is trading on a fine line.
Monday, the 21st of December
- China: PBoC Interest rate Decision
- Italy: Trade Balance
- United States: Chicago Fed National Activity Index, US Treasury to auction 20-year bonds
- Eurozone: Consumer Confidence
Tuesday, the 22nd of December
- Australia: Retail Sales
- United Kingdom: Gross Domestic Product
- Germany: Gfk Consumer Confidence Survey
- United States: Gross Domestic Product Annualized, Core Personal Consumption Expenditures, Core Personal Consumption Prices
- Japan: BoJ Monetary Policy Meeting Minutes
Wednesday, the 23rd of December
- Australia: Trade Balance
- Japan: Leading Economic Index
- United States: Durable Goods Orders, Nondefence Capital Foods Orders ex Aircraft, Personal Spending, Initial Jobless Claims 4-week average, Michigan Consumer Sentiment, US Treasury to auction 5-year TIPS
- Canada: Gross Domestic Product
- Switzerland: SNB Quarterly Bulletin
Thursday, the 24th of December – Christmas Day
- Japan: Tokyo Consumer Price Index, Unemployment Rate, Retail Rate
Friday, the 15th of December – Christmas Day