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Livesquawk - Closing Wrap - Friday 17.12
Closing Wrap - Friday 17.12
Headlines
  • US Senate To Miss Year-End Deadline On $1.75 Trillion Biden Bill
  • Fed’s Waller: Rate Hike Is Warranted Shortly After Taper Ends
  • Fed's Williams: Faster Taper Creates Possibility Of Rate Hikes Next Year
  • Fed's Daly: We May Need 2 Or 3 Interest Rate Hikes In 2022
  • US Unemployment Rate Falls In Nearly All States, 8 At Record Low
  • JPMorgan Sees Weak Holiday Spending And Warns Of A Retail Slowdown
  • ECB’s Wunsch: ECB Must Follow Its Peers With a Tough Inflation Message
  • ECB’s Kazaks: ECB 'Increasingly Likely' To Hit The 2% Inflation Goal
  • German Business Morale Dips For Sixth Consecutive Month In December
  • US Treasury Yields Fall As Traders Assess Fed, Omicron Variant Effects
  • Dollar Remains On The Back Foot After Hawkish Tilts By BoE, ECB
  • Bitcoin Drop Risks Extending Slide To A Fifth Consecutive Week
  • Oil Prices Set For Weekly Loss On Omicron Uncertainty And Restrictions
  • Wall Street Weighed Down By Economy-Sensitive Cyclical Stocks
  • US Agencies Recommend FCC Grant Google, Meta Undersea Cable Licences
  • Evergrande Declared In Default By S&P For Failed Coupon Payments
  • Turkey Halts Equity, Equity Derivatives, Debt Repo Market Trades
  • Bank Of Russia Delivers A 100Bp Hike But Signals Become Less Hawkish
Commentary
Fed's Waller: Rate Hikes Warranted "Shortly After" Taper Ends

An interest rate increase will likely be warranted “shortly after” the Federal Reserve ends its bond purchases in March, with inflation “alarmingly high” and the job market near maximum employment, Federal Reserve Governor Chris Waller said on Friday.

 

The Fed this week agreed to accelerate the end of its pandemic-era bondbuying to March, a precursor to raising rates, as policymakers acknowledged inflation was not easing as quickly as expected and required them to be ready to act by imposing higher borrowing costs. (Continue Reading – Reuters)

European Credit Supported By ECB Changes

The market reacted in a rather timid way on the back of the European Central Bank's news yesterday. This indicates that much of what was announced was already expected and priced into spreads. However, we believe this could be an underreaction, as we expect this will further strengthen technicals, Because of the increase in APP, CSPP will see higher than expected purchases, as CSPP already runs at 27.5% of APP. Indeed this may fall slightly, but CSPP will still be a large portion of APP. Furthermore, the ECB will be pushed into the secondary market a lot more due to lower supply and the bank may be adjusting their way of purchasing in primary. (Continue Reading – ING)

German Business Confidence Falls For Sixth Straight Month

German managers expressed less optimism again in December as Europe’s most populous country continues to grapple with the coronavirus.

 

Germany’s Ifo Institute reported the sixth straight decline in its headline business climate index, which fell to 94.7 points versus the market estimate of 95.3 and November’s upwardly revised reading of 96.6.

 

According to the results of Ifo's monthly survey of business leaders, the expectations component of the index dropped to 92.6 to miss the estimate of 93.6 and last month’s mark of 94.2, The current assessment component fell 96.7, which was below the forecast of 97.5 and the 99.0 reading in November. (Continue Reading – LiveSquawk)

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