Today's calendar of economic data releases is dominated by US data that will tell us more about how the US economy is doing. The main theme in the US economy is the slowdown in the manufacturing sector and the concomitant steady growth in the service sector, which has left economic policy makers in a difficult position.
Today we get US-figures on industrial and manufacturing production. The manufacturing sector is struggling due to a combination of the strong USD, the slowdown in manufacturing globally and the slowdown in the US energy sector. While the lower oil price has lowered input costs, it has also hit demand for US manufacturing goods as the energy sector is a large buyer of them. The latest ISM figures on manufacturing have been very weak and hence we are not too optimistic on the 'hard' manufacturing data.
Also due for release today are figures on US private consumption, namely the University of Michigan consumer confidence and retail sales. We expect solid releases due to growing real income, rising consumer confidence in previous months and a boost to consumers' purchasing power from the lower energy prices. The Fed's Dudley (voting member, dovish) will hold a speech on the economic and monetary policy outlook in the US. We will also get US PPI figures.
In the UK construction output figures for November are due. The figures should give us more insight into how the UK performed growth-wise in Q4.
Today the International Atomic Energy Agency is expected to report that Iran has fulfilled its commitment under the nuclear agreement, which could lead to the decade- long sanctions being lifted as early as Monday.
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