In the new trading week, monetary policy is likely to attract renewed interest on both sides of the Atlantic. Following the latest US jobs report, fresh inflation data for the United States will be on the agenda. In the eurozone, the ECB will meet for the last time this year to decide on the future of monetary policy.
US labor market data from last Friday likely Keeping investors busy
With a total of 200,227 new jobs, significantly more jobs were created last month than economists had expected in advance (200,000). However, the separately calculated unemployment rate rose by 0.1 percentage points to 4.2%.
Average hourly wages also rose again compared to the previous month, which could tend to give the US Federal Reserve (Fed) a stomach ache. However, the pace of job creation appears to be losing some of its momentum. In this context, investors are still betting on an interest rate cut of a quarter of a percentage point on December 18.
Focus on China data in the first half of the week - US core inflation could tread water
Even if the economic data calendar provides fewer relevant stimuli at the start of the week, investors should be prepared for some high-caliber events in the coming days.
On Tuesday, the focus will initially be on important Chinese data. Import and export data will be published in the night from Monday to Tuesday (04:00).
How smoothly the economic engine is running in the world's second-largest economy could be the gold standard for investors.
In the middle of the week, the US inflation data (14:30), which could decide the weal and woe of the stock market week, is likely to be watched with great interest.
The core rate of inflation is expected to be 3.3% compared to the same month last year, which means no change.
According to forecasts, the inflation rate, including energy and food, is likely to have risen by 2.7 percent, slightly more than in October (2.7 percent).
US producer prices, which are expected at 14:30, should also be important on Thursday. This data can provide important indications of inflation trends.
ECB likely to cut interest rates by 25 basis points - hopes that capital market interest rates will continue to fall globally
On Thursday, US investors are likely to turn their attention to developments in the eurozone when the European Central Bank (ECB) decides on its future monetary policy. The deposit interest rate, which is seen as a trend-setter for the financial market, could be lowered by a quarter of a percentage point to 3.0% (14:15). The ECB press conference with Christine Lagarde will follow at 14:45. However, investors are not expecting any major surprises.
As on Monday, there are no important events on the agenda on Friday. Around a month after the US presidential election, investors could be positioning themselves for a possible year-end spurt. With the publication of new US inflation data, market participants are hoping that the US Federal Reserve will set the course for a further interest rate cut this year.
