U.S.:
Dollar inches lower into Christmas lull
The dollar headed into the Christmas break on Friday just over half a percent off highs hit after this month’s U.S. Federal Reserve policy meeting, with a handful of second tier data unlikely to disturb markets already firmly in holiday mode. With Tokyo already absent, the dollar inched down to 117.47 yen, compared with 10-month highs of 118.66 yen reached a week ago and almost unchanged for the year, having been as low as 99.00 in June. The euro was also a shade firmer at $1.0440, having rebounded only modestly from a nearly 14-year low of $1.0350 set earlier in the week. Bets that the greenback will strengthen further are one of the dominant expectations on markets for the start of next year, but dealers expect little immediate progress over the next two weeks when most investors will be absent and volumes low.
<http://www.reuters.com/article/uk-global-forex-idUSKBN14B2JG>
Europe:
UK economy sidesteps Brexit vote hit, 2017 outlook darker
British consumers brushed off June’s Brexit vote and drove the economy to expand faster than expected in the third quarter, but a hefty current account gap and weaker trade and investment raised warning flags for 2017. The economy grew by 0.6 percent in the three months to September, above its long-run average and beating expectations in a Reuters poll of economists who expected the Office for National Statistics to stick with its earlier estimate of 0.5 percent. The ONS also revised down growth for the second quarter to 0.6 percent, meaning there was no slowdown at all following June’s Brexit vote – confounding predictions at the time that the ‘Leave’ vote would push Britain’s economy into recession.
<http://www.reuters.com/article/us-britain-economy-idUSKBN14C0T1?il=0>
South America:
China’s money rates decline as liquidity pressure eases
China’s primary money rates, which rose at the start of this week, were largely lower on Friday as liquidity tightness eased after fund injections by the central bank and progress resolving a bond scandal that rocked the market. The volume-weighted average rate of the benchmark seven-day repo traded in the interbank market, considered the best indicator of general liquidity in China, was 2.4492 percent Friday afternoon. That was nearly 20 basis points lower than the previous week’s closing average rate. On Monday, the weighted average rate was 2.6580 percent. At the beginning of the week, liquidity was squeezed after media reports about forged bond agreements at Sealand Securities, which hit market confidence. "Institutions who had money were unwilling to lend to others," said a trader at a Chinese bank in Shanghai. The trader added that the market didn’t gain momentum until it received liquidity support and Sealand Securities announced moves to deal with the issue.
<http://www.reuters.com/article/china-bonds-idUSL4N1EI1YB>