Forex - Rates Highlights - 08 December 2017


 06:00 (GMT) 08 Dec

  [Forex Highlights]

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Rates Highlights - 08 December 2017 (0100-VRPF-C01)

T. Bonds: Payrolls up next, we look on the firm side and bias this year has been for yields to finish day higher.

Bunds and Gilts: European core may see some let up if US yields do bounce, but likes of Italy and Portugal remain strong in this early December window.

JGB: JGB futures met with resistance at 151 level once again. No fresh incentives to spark a trending move on BOJ being firm and clear on their stance as expected.

DJIA and S&P: Tone improving again but fresh highs probably too much to expect before the weekend. Payrolls will be less important than CPI for the FOMC.

US Overview:

The GBP ended higher after a choppy day after suggestions that a deal with Ireland on the border might be close, but otherwise the USD was firmer, supported by rising UST yields. Equites were up but off their highs.

US Highlights:

- US Initial Claims fell 2k to 236k vs 240k exp.

- US Oct Consumer Credit +$20.5bn vs $17.0bn exp.

Asia-Pacific Highlights:

Australia October Home-Loan Approvals Fall 0.6% M/M; Est. 2% Drop ~ BBG

Japan's third-quarter growth twice as fast as first estimated, outlook brightens ~ Reuters

China Exports Jumped in November as Import Gains Signal Strength ~ BBG

'Slightly modified' Irish border text under consideration: governing party MEP ~ Reuters

Senate clears 2-week stopgap funding bill, sending it to trump ~ BBG

Brexit deal on Irish border possible by Friday: EU Commission ~ Reuters

Trump dangles Middle East peace plan to limit Jerusalem outcry ~ Reuters

China aims to make IPO application process more transparent ~ Reuters

China denies making impossible demands for collapsed US$14 billion infrastructure deal with Pakistan ~ SCMP

China coal imports rise in November despite push against pollution ~ Reuters

Brent Oil: $62.20, +$0.98; Asia: $62.23, +$0.03

T. Notes: 124.34, +0.06

Treasuries: In USTs, early activity was light with 30s having the best of it, but late in the day the long end led a bounce in yields as Brexit optimism, progress towards avoiding a government shutdown and suggesting from Trump that an infrastructure plan was coming all coincided. 2s -0.4bps @ 1.80%, 5s +1.2bps @ 2.14%, 10s +2.9bps @ 2.37%, 30s +3.5bps @ 2.77%.

Equities had a positive tone but came off their highs late in the session as UST yields picked up.

Europe: Very quiet conditions in Europe, only briefly enlivened by the soft 30yr gilt auction that pushed yields there back into range and dragged bonds generally. A better long end in USTs reasserted the supportive bid later in the session. GB30s still end around +3bp. Better buying back with particular force in BTPs (IT10s -4bp) and long end of PGBs.

Australia: Australia government bonds open lower, with 3-year futures at 98.03, reversing gains since Wednesday. Yield curve flattens slightly with short-end up around 2bps and ultra-long end down 0.8bps.

Japan: JGB futures pushes higher to 151.00. 0.836%. Yield curve modestly lower across the curve generally. 10s down half a bps to 0.050.

Rates Highlights - 08 December 2017 (0100-VRPF-C02)

Data:

JP: Bank Lending Data (Ex trusts) (Nov) 2.7% y/y (Prev: 2.8)

JP: GDP (Final) (Q3) 2.5% q/q ann (Mkt: 1.5 Prev: 1.4)

AU: Housing Finance (Oct) 1.6% m/m (Prev: -6.2)

AU: Lending Finance (Oct) -0.6% m/m (Mkt: -2 Prev: -2.3)

JP: Economy Watchers Survey (Nov) 55.1 (Mkt: 52.1 Prev: 52.2)

NL: Manufacturing Production (Oct) -0.7% m/m (Prev: 1.4)

NL: Manufacturing Production (Oct) 4.0%y/y (Prev: 5.2)

Still To Be Released -

Data:

07:00 GMT - DE: Current Account (nsa) (Oct) EUR bn (Mkt: 20 Prev: 25.4)

07:00 GMT - DE: Trade Balance (Oct) EUR bn (Mkt: 21.9 Prev: 24.1)

07:45 GMT - FR: Industrial Production (Oct) % m/m (Mkt: -0.1 Prev: 0.6)

07:45 GMT - FR: Industrial Production (Oct) % y/y (Mkt: 2.9 Prev: 3.2)

07:45 GMT - FR: Manufacturing Production (Oct) % m/m (Prev: 0.4)

07:45 GMT - FR: Manufacturing Production (Oct) % y/y (Prev: 3.1)

09:00 GMT - IS: GDP (Q3) % q/q (Prev:)

09:00 GMT - IS: GDP (Q3) %y/y (Prev:)

09:30 GMT - UK: Construction Output (sa) (Oct) % m/m (Mkt: 0.1 Prev: -1.6)

09:30 GMT - UK: Construction Output (sa) (Oct) % y/y (Mkt: 1.8 Prev: 1.1)

09:30 GMT - UK: Industrial Production (Oct) 4cast: -0.5% m/m (Mkt: 0 Prev: 0.7)

09:30 GMT - UK: Industrial Production (Oct) 4cast: 3% y/y (Mkt: 3.5 Prev: 2.5)

09:30 GMT - UK: Manufacturing Production (Oct) 4cast: -0.5% m/m (Mkt: 0 Prev: 0.7)

09:30 GMT - UK: Manufacturing Production (Oct) 4cast: 3.3% y/y (Mkt: 3.8 Prev: 2.7)

09:30 GMT - UK: Trade Balance (Non-EU) (Oct) bn (Mkt: -3.3 Prev: -2.982)

09:30 GMT - UK: Visible Trade Balance (Oct) GBP bn (Mkt: -11.5 Prev: -11.25)

10:00 GMT - GR: CPI (Nov) % y/y (Prev: 0.7)

10:00 GMT - GR: HICP (Nov) % y/y (Prev: 0.5)

13:00 GMT - UK: NIESR GDP Est. (Nov) % q/q (Mkt: 0.4 Prev: 0.5)

13:15 GMT - CA: Housing starts (Nov) 4cast: 215k (Mkt: 213 Prev: 222.8)

13:30 GMT - CA: Capacity Utilization (Q3) % (Prev: 85)

13:30 GMT - US: Average Hourly Earnings (Nov) 4cast: 0.3% m/m (Mkt: 0.3 Prev: 0)

13:30 GMT - US: Non-farm Payrolls (Nov) 4cast: 220k (Mkt: 195 Prev: 261)

13:30 GMT - US: Private Payrolls (Nov) k (Mkt: 198 Prev: 252)

13:30 GMT - US: Unemployment (Nov) 4cast: 4.1% (Mkt: 4.1 Prev: 4.1)

15:00 GMT - US: Univ of Mich Sent. (Prelim) (Dec) (Mkt: 99 Prev: 98.5)

15:00 GMT - US: Wholesale Inventories (Final) (Oct) % m/m (Mkt: -0.4 Prev: -0.4)

Events & Auctions

AT: Market Holiday - Immaculate Conception

ES: Market Holiday - Immaculate Conception Day

PT: Market Holiday - Immaculate Conception Day

07:00 GMT - SE: Riksbank's Ingves Speaks in Stockhom

11:00 GMT - UK: Bills Auction


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