Summary:

• The US JOLTs Job Openings report is the only relevant figure in today’s calendar
• 3 major central banks to dominate the week ahead
• USD and GBP should be vulnerable to the data scheduled to release this week.

Monday is going to be a calm day as far as the economic calendar is concerned. The JOLTs Job Openings report from the US is the only important figure for traders in today’s agenda. However, the whole week should be far more interesting as 3 major central banks are scheduled to hold their meetings and we get a string of crucial data from the US and UK economy.

3:00 pm BST – US, JOLTs Job Openings report for November. This report is conducted in order to measure job vacancies. It collects data from employers about their plans to hire new staff. The latest NFP report showed a healthy increase in employment and today’s release should also confirm a good shape of the US labour market.

What to watch beyond Monday:

This could be the biggest week for major currencies in December as we have the three major central banks scheduled to take their decisions: the Fed, the ECB and the Bank of England. The past week was a bit chaotic for the British pound mainly due to Brexit talks which resulted in an agreement enabling both sides to enter the second stage of Brexit negotiations. Inflation releases from both the US and UK will add to volatility on the main pairs.

Central banks: FED (Wednesday, 7:00pm GMT), BoE (Thursday, 12:00pm GMT), ECB (Thursday, 12:45pm GMT)

This week will be full of central banks’ decisions with the Fed absolutely being the number one. In this case market participants have already fully priced in a rate hike, so attention will be paid to projections for 2018 where three more hikes have been communicated so far by the US central bank. Keep in mind that this will be also the last post meeting conference held by Janet Yellen. The ECB already made its move last time but focus shall be on new projections. The euro could find itself under pressure though as speculative positioning hovers close to all-time highs. The Bank of England meeting is unlikely to change much on the monetary policy front but these meetings usually have a big intraday impact on the pound anyway. Affected markets: EURUSD, EURGBP.

The US data: CPI (Wednesday, 1:30pm GMT), Retail sales (Thursday, 1:30pm GMT)

US dollar traders could end this year on a positive note if the greenback maintain its momentum throughout December. While risks surrounding the tax bill have moderated to some extent of late investors will watch inflation and retail sales data in order to seek reasons for higher rates in the following year. Moreover, the Congress delayed a possible government shutdown last week until 22 December, the move which could be USD positive for as long as the data does not disappoint. Affected markets: US500, USDJPY.

The UK data: CPI (Tuesday, 9:30am GMT), Labour market report (Wednesday, 9:30am GMT), Retail sales (Thursday, 9:30am GMT)

There is no doubt that the GBP has been driven by politics rather than macroeconomics recently, however things could change this week because of avalanche of key data releases. All eyes will be on wage growth and inflation as both might have a decisive impact on the backdrop of household expenditure, the key part of the UK economy. Affected markets: GBPUSD, GBPJPY.

 GBPUSD remains in the uptrend, however, it has not managed to break above the latest highs boding ill for bulls. Source: xStation5