Policymakers at the US Federal Reserve are expected to bring a measure of Christmas cheer to borrowers this week, with officials widely forecast to lower interest rates on Wednesday.

An economists’ poll predicted the Federal Open Market Committee (FOMC) will cut its main rate by 25 basis points to take the Fed funds target range to 3.50%-3.75% at the close of its two-day meeting.

Barclays’ Marc Giannoni maintained his call for a December cut, citing rising downside risks to employment, despite mixed signals from Fed speakers during the inter-meeting period. “Our expectation has been based on labour market indicators showing some weakening, creating enough concern among FOMC members for them to ultimately cut again.”

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The Bank of Canada’s Governing Council is widely expected to stay on the sidelines at its final meeting of the year on Wednesday, having previously signalled that monetary policy was likely near the limits of what it could do to support the economy in the current environment.

Economists broadly expect the Ottawa-based central bank to keep its policy rate unchanged at 2.25%, effectively ending its current easing cycle.

TD Securities said the policy statement should “strike a more upbeat tone” following the sharp rebound in Q3 GDP and further labour-market strength. At the same time, guidance may highlight recent progress and repeat the bank’s pledge to maintain price stability.

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French Prime Minister Sébastien Lecornu scored a key political victory Tuesday after lawmakers approved next year’s social security budget by just 13 votes.

The bill still faces a vote in the French Senate, but its passage in the more powerful National Assembly is a positive sign for the future of Lecornu’s minority government and to financial markets worried about France’s ability to rein in its spiraling budget deficit.

After the vote, Lecornu — whose two immediate predecessors failed to pass social security budgets — praised lawmakers for showing "responsibility" in adopting the legislation.

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Swiss rate-setters are widely expected to hold their key rates at current levels Thursday, a stance they may adopt for the longer term, according to analysts.

An economists’ poll predicted an unchanged Swiss National Bank policy rate of zero percent, with only very few analysts noting that the bank could lower its benchmark rate into negative territory at -0.25%. A hold this month would repeat the decision in September, which followed six straight reductions, including cuts of 25 basis points in June and March, and 50bp last December.

Headline annual inflation in the Alpine country last month dropped to zero from 0.1% in October, keeping it at the bottom of the SNB target range of 0-2%. November consumer prices contracted -0.2% on the month versus the previous flat reading. But this increased weakness in consumer price growth is unlikely to spur officials into a rate cut on Thursday.

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