The last week before Christmas has arrived and markets behaving accordingly. Last week Fed’s meeting result was expected as the central bank raised interest rates by 0.25 basis points. Yet, markets reacted aggressively to the Fed hawkish expectations for 2017 pushing the US Dollar strength to 14 year high.
The week ahead, markets will be watching closely on Fed chair Janet Yellen speech on Monday. After last week growth estimation by the Federal Reserve, signaling three rate hike in the next year, investors will seek further confirmation of the world largest economy.
On Tuesday, markets will focus on BoJ rate decision and policy statement to get an indication of Japan’s economy. The Japanese Yen has been devalued since US election and Fed rate hike.
UK and US GDP data will be released on Friday.
Here are the main economic events of the upcoming week:
German IFO Business Climate
The German Business climate for December will be released on Monday at 09:00 GMT and expected to rise to 110.9 from 110.4 a month earlier.
Federal Reserve Chair Janet Yellen Speaks
On Monday at 18:30 GMT, Fed chair Janet Yellen will deliver a speech at the University of Baltimore on the state of US job market. As the US employment continues to constantly improve, any hawkish comments by Yellen will effects markets sentiment.
RBA Meeting Minutes
The Reserve Bank of Australia will publish its meeting minutes on Tuesday at 00:30 GMT. The RBA kept its benchmark interest rate unchanged at 1.5% at its December meeting. Markets will be watching for the central bank policy sentiment.
Bank of Japan Rate Decision and Policy Statement
The BoJ rate decision will be released on Tuesday at 03:00 GMT. The Japanese central bank is expected to hold negative interest rates at -0.1% and continue its annually 80 trillion Yen quantitative easing program of Japanese government bonds purchase.
Bank of Japan Governor Haruhiko Kuroda will hold a press conference after the rate decision announcement to discuss Japan’s economy.
UK Q3 Growth Domestic Product
United Kingdom third quarter GDP will be published on Friday at 09:30 GMT. The final estimate is expected to remain unchanged at 0.5% in July-September period while YoY is expected to grow by 2.3%.
US Q3 Growth Domestic Product
On Friday at 13:30 GMT the US will release its final third quarter growth estimation. Q3 growth data is expected to rise by 3.3% compare to 1.4% in the previous quarter. Last week, the Fed increased interest rates by 0.25 basis points and signaled for three rate hikes in 2017.