[U][B]Fundamental Headlines[/B][/U]
• [B]USDCHF [/B]– Factory gate costs in Switzerland unexpectedly fell during the month of December, as a drop in the price of crude oil from the month prior pulled headline figures lower. Indeed, the producer and import price index dipped 0.1 percent from November, while annual rate of growth went unchanged at 3.0 percent in Switzerland. For more resources, visit the new Swiss Franc Currency Room.
• [B]EURUSD [/B]– Similar to Switzerland, German producer prices fell 0.1 percent in December on the back of softer petroleum product costs. However, crude rocketed to a record high of $100.09/bbl in the early days of January, which may cause these figures to accelerate in coming months. As a result, the European Central Bank may not be quick to believe that inflation pressures have eased, and instead, will likely maintain their staunchly hawkish bias. What do you think will happen to EUR/USD?For more resources, visit the new Euro Currency Room.
• [B]GBPUSD [/B]– UK M3 money supply surprisingly surged 1.5 percent during the month of December, and while the BOE does not focus as much on money supply figures as the ECB does, the UK central bank may still be a bit concerned about brewing inflation pressures. Furthermore, BOE Deputy Governor John Gieve’s issued comments last week that suggested monetary policy will remain more neutral this year, and as a result, we do not expect the central bank to cut rates in February unless credit conditions tighten severely ahead of the meeting. Discuss the BOE in the GBP/USD Forum or visit our recently updated British Pound Currency Room for specific resources geared towards Sterling.
• [I]Europe Enters Bear Market, Asian Stocks Slide in Global Rout /I – Bloomberg
• [I]Trichet, Summers See Less Optimism After Complacency /I – Bloomberg
• [I]Japan Regional Economies Are Showing `Sluggishness,’ MOF Says /I – Bloomberg
• [I]Northern Rock Gets UK Bond Backing[/I] (link) – The Wall Street Journal
• [I]Economic Uncertainty To Dominate Davos[/I] (link) – Financial Times
