Highlights
Germany's Ifo business climate index is expected to post a third straight monthly increase, rising to 87.8 in December from 87.3 in November and 86.9 in October.
The US housing market index is forecast to edge 2 points higher to 36 in December after falling 6 points in November to 34. This was much lower than expected and reflected high financing costs and high home prices.
The Reserve Bank of Australia will release the minutes of its Dec. 5 meeting at 11:30 a.m. AEDT Tuesday (7:30 p.m. EST Monday/0030 GMT Tuesday). At the meeting, the RBA left its main policy rate, the cash rate, at 4.35 percent after raising it by 25 basis points to 4.35 percent from 4.10 percent in November and having left rates on hold at its previous four meetings. There are uncertainties regarding the lags in the effect of monetary policy and how firms' pricing decisions and wages will respond to the slower growth in the economy at a time when the labour market remains tight, RBA Governor Michele Bullock said in a policy statement this month.
The Bank of Japan's policy board is expected to decide to retain its guidance that it will patiently continue with monetary easing in order to achieve the price stability target of 2 percent in a sustainable and stable manner, accompanied by wage increases. To this effect, it is likely to keep the targets of minus 0.1 percent for the short-term policy rate and around zero percent for the 10-year bond yield, the latter of which was adjusted in October to allow an upward swing to around 1.0 percent in light of higher yields in the U.S. market.
BoJ policymakers are expected to maintain the current easing stance for now as they are likely to refrain from raising interest rates at least until April, when they may be able to see a clearer sign that wages will continue rising substantially in the next fiscal year. Since the long end of the yield curve control framework has been made more flexible twice in three months this year (some took as a gradual step toward phasing out the yield curve control framework), the market focus is on when the central bank will end its negative interest rate policy introduced in January 2016.
The US housing market index is forecast to edge 2 points higher to 36 in December after falling 6 points in November to 34. This was much lower than expected and reflected high financing costs and high home prices.
The Reserve Bank of Australia will release the minutes of its Dec. 5 meeting at 11:30 a.m. AEDT Tuesday (7:30 p.m. EST Monday/0030 GMT Tuesday). At the meeting, the RBA left its main policy rate, the cash rate, at 4.35 percent after raising it by 25 basis points to 4.35 percent from 4.10 percent in November and having left rates on hold at its previous four meetings. There are uncertainties regarding the lags in the effect of monetary policy and how firms' pricing decisions and wages will respond to the slower growth in the economy at a time when the labour market remains tight, RBA Governor Michele Bullock said in a policy statement this month.
The Bank of Japan's policy board is expected to decide to retain its guidance that it will patiently continue with monetary easing in order to achieve the price stability target of 2 percent in a sustainable and stable manner, accompanied by wage increases. To this effect, it is likely to keep the targets of minus 0.1 percent for the short-term policy rate and around zero percent for the 10-year bond yield, the latter of which was adjusted in October to allow an upward swing to around 1.0 percent in light of higher yields in the U.S. market.
BoJ policymakers are expected to maintain the current easing stance for now as they are likely to refrain from raising interest rates at least until April, when they may be able to see a clearer sign that wages will continue rising substantially in the next fiscal year. Since the long end of the yield curve control framework has been made more flexible twice in three months this year (some took as a gradual step toward phasing out the yield curve control framework), the market focus is on when the central bank will end its negative interest rate policy introduced in January 2016.
Definition
Market Focus details key factors in the coming day that will impact the economic outlook and the financial markets. These include central bank events, economic indicators, policymaker speeches as well as expected political and corporate developments.
Description
Keeping up-to-date with event schedules and the economic calendar is key to understanding the global financial system. Econoday's Market Focus allows investors and policymakers to carefully track what will be making news and moving the financial markets in the coming day.
