Another missed deadline
Today’s news headlines:
‘EU and UK still ‘far apart’ but Brexit deal hopes rise’. Both sides have agreed to extend negotiations on a post-Brexit deal, after Sunday’s ‘deadline’ for a trade agreement came and went without the UK or EU managing to resolve the remaining sticking points. No new deadline has been set, but both sides need time to ratify any trade agreement before the end of the transition period on January 1st. EU officials acknowledged that there had been progress in the talks, which has boosted Sterling since yesterday’s market open. (Financial Times)
‘Germany set for hard lockdown as coronavirus surges’. Europe’s economic powerhouse nation will plunge into a hard lockdown from Wednesday, meaning all shops and schools will close as the country tries to combat a surge in coronavirus infections. German Chancellor Angela Merkel, admitted that the restrictions would affect the Christmas period but that authorities were ‘forced to act’. The government has agreed financial aid to companies affected by the shutdown, worth up to €500k per month for each business. (Financial Times)
Today's events, rates, and data
- At yesterday’s market open, Sterling gained some immediate relief from Friday’s selling pressure. Sterling rose over 1% against the US Dollar on reports of extended Brexit talks. We expect more pronounced volatility for the Pound in the coming week due to thinner liquidity conditions. Risk assets were moderately higher overnight as investors took comfort from the continued vaccine rollout.
Japan Revised Industrial Production: 4.0% vs 3.8% previously
Eurozone Industrial Production: 10.00am
German Buba Monthly Report: 11.00am
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