Market Movers
Markets will continue to keep a watchful eye on emerging markets but it has been relatively calm overnight with large parts of Asia off today for celebration of the Chinese New Year. There is a central bank meeting in Mexico today but it is not a prime candidate for a rate hike.
In the data calendar the main event is the release of euro area inflation. The German inflation data released yesterday did not change our forecast that euro area HICP inflation will be unchanged at 0.8% y/y in January. We expect core inflation to have edged slightly higher but this has been offset by lower energy and food price inflation. Our forecast is a notch below consensus and we even see downside risk to it.
Otherwise personal spending and income for December and Chicago PMI for January will be the main focus in the data calendar.
In addition, we have a flood of central bank speeches. ECB's Nowotny, Noyer, Coeure and Rimsevics are all scheduled to speak today. Fed's Fischer (hawk, voter) and George (neutral, non-voter) will be speaking later in the day.
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