UK Inflation Falls Faster Than expected

In the UK, both headline and core inflation fell faster than expected in November. Headline CPI slipped below the 4% mark, as core inflation eased to 5.1%. Cable slipped below 1.27 as a kneejerk reaction to the softer-than-expected inflation figures.

Euro Lower on German PPI Decline

Germany’s producer price index fell by 7.9% y/y in November, another sharp decline after the October reading of -11%. This was lower than the market consensus of -7.5% and marked a fifth straight month of decline. Monthly, PPI dropped 0.5%, more than the consensus estimate of -0.3% and following a 0.1% decrease in October.

Steady Recovery Signals Strength Amid Market Cautiousness

Bitcoin is losing 0.6% in 24 hours, trading at $42.8K. The resistance of the ascending channel from late October has recently got support, marking the persistence of the buy-the-dip pattern. This behaviour is setting up for a quick retest of the December highs near $45K.

Soft Inflation Has Pressed the Pound, But Hardly the BoE

Britain’s impressive slowdown in inflation has increased speculation around a rate cut next year. The headline consumer price index lost 0.2% in November, and the annual rate slowed from 4.6% to 3.9% – impressively below the expected 4.3%. Inflation excluding food and energy slowed from 5.7% to 5.1%, versus an expected 5.6%. This is the slowest rate of growth since September 2021 in the former and since January 2022 in the latter.

Cracks

We start feeling the cracks in market optimism: the bonds extended their rally yesterday after the inflation data in Britain surprised to the downside, but major US indices saw a sharp retreat. A 12% plunge in FedEx – which acts like a gauge of economic activity, the overbought market conditions in major global stock indices and the awareness that a further fall in bond yields weaken the idea of soft landing triggered a much-needed retreat in equity valuations.

After BoJ Decision, Yen Traders Turn to CPIs and Summary of Opinions

On Tuesday, the Bank of Japan decided unanimously to keep interest rates untouched at -0.1% and stick to its yield curve control policy framework that places an upper bound of 1% for the 10-year Japanese government bond yield as reference. With the Bank giving no signals that the era of ultra-loose policy conditions is nearing its end, yen traders were largely disappointed, with the currency turning south again.

Canadian Dollar Edges Higher Ahead of Retail Sales

It’s a busy end of the week for Canadian releases, with retail sales today and the GDP on Friday. Both indicators are expected to accelerate, which could give a boost to the Canadian dollar. The US releases third-estimate GDP for the third quarter, which is expected to confirm the previous estimate of 5.2%.

USD/JPY Eyes Inflation, BoJ Minutes

The Japanese yen is in positive territory on Thursday. In the European session, USD/JPY is trading at 142.85, down 0.61%. Later today, the US releases third-estimate GDP for the third quarter, which is expected to confirm that the economy grew at an impressive rate of 5.2% q/q.

BTC/USD: News Reports Encourage Bulls to Attack the $44k Level

Optimism associated with the SEC regulator's approval of applications to launch BTC-ETF is the main driver of Bitcoin price growth.

Canada: Retail Trade Enters Holiday Season on a High Note.

Canadian consumers have been in the festive spirit this holiday season, having broadened their spending across several categories. Looking ahead, auto sales are tracking strong and our own card spending estimates point to a higher reading in November. Meanwhile, Statistics Canada expects sales to come in flat next month based on responses from roughly half of retailers surveyed.