Today's news headlines:
'UK public sector borrowing soars more than expected'. This morning, figures from the Office of National Statistics showed that UK public sector net borrowing reached £27.4bn in December, the highest reading for the same month since records began 30 years ago. The government debt increased as rising interest payments on public debt coupled with the cost of shielding businesses and consumers from elevated energy prices drained public finances. The public debt figure is almost triple the £10.7bn deficit just 12 months earlier and well over economists' predictions of £17.3bn. (Financial Times)
'China property rebound on support measures from Beijing'. Chinese authorities' efforts to support the battered property sector are showing signs of promise as the country's high-yield Dollar bond index has regained almost 50 percent since the record lows seen two months ago. The rebound on bonds issued by Chinese real estate developers is an indication that foreign investors have started to return to the market after leaving due to efforts by Beijing to reduce excessive leverage in the sector (Financial Times)
Today's calendar is dominated by PMI updates from the US, UK, and Eurozone. The EU manufacturing and services PMIs both fell short of 50 last month; however, the services index was only marginally so, and it is expected to take a stroll in the expansion territory for January. Things are looking gloomier in the UK as both PMIs are forecasted to drop slightly, signalling a continued fall in manufacturing and services output.
Japanese Core CPI y/y: 3.1% vs 2.9% previously
EU Flash Manufacturing PMI: 9:00AM
EU Flash Services PMI: 9:00AM
UK Flash Manufacturing PMI: 9:30AM
UK Flash Services PMI: 9:30AM
US Flash Manufacturing PMI: 2:45PM
US Flash Services PMI: 2:45PM
New Zealand CPI q/q: 9:45PM
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*Indicative interbank rates taken on the day of writing. Please speak to your Dealer to find out the current rates available for you.