Today is known as “Manic Monday” and is characterised by lots of shopping and is the busiest day of the year for shopping online. Much busier than Black Friday, Cyber Monday, Christmas Eve, Boxing Day and every other day that people buy things. I doubt this was what Susannah Hoffs and the rest of The Bangles had in mind when they predicted this day about 25 years ago…
Friday saw a huge figure from the US. In recent times, the non-farm payrolls data have come in as forecast and not caused too much of a ripple in the markets. Not on Fervent Friday, however. The figure was predicted to come in at around 230,000 additional jobs in November and came in way over expectations at 351,000. Wages grew 0.4%, annual wage growth was up 2.1% and is a clear sign that the job market is on its way back to normality. In stark contrast, the Canadian Dollar touched a 5-year low as there was a decrease of 107,000 jobs in November. All this points to an interest rate hike before any other developed nation and a continually strengthening US Dollar.
This week, we are looking for the Bank of England minutes to see where Sterling goes next. Interest rate hikes are still being discussed, but it is the affordability of these hikes to households which is causing delay. Whilst the economy seems to be creeping back to normalisation, Mark Carney and his Bank of England colleagues seem to be hamstrung by a lack of wage gains and increasing risks from the Eurozone.
Talking of the Eurozone, things are still looking gloomy as the single currency is expected to weaken further and a sustained spell of no inflation is seen as being as harmful as deflation. Previous measures haven’t worked and it is looking increasingly likely Mario Draghi will have to bite the bullet and introduce QE.
Major news out today includes: sales from any retailer you care to mention, industrial production from Germany, housing stats from Canada and labour market conditions from the US.