Morning Update – 14/12/2017 – by Arjun Lakhanpal

Morning all.. Slightly weaker Core CPI in the US and no increase in inflation or growth targets from the Fed, sent US stocks to another record high with the S&P closing up 0.2% but stocks in Asia were weaker with the Nikkei down 0.28% on a lower USDJPY and HK and Shanghai lower as China raised rates in line with the Fed. The dollar was flat after sliding yesterday along with U.S. Treasury yields in the wake of the Fed keeping 2018 monetary-tightening plans as is despite boosting its growth projection. The Australian dollar hit a five-week high after better-than-expected jobs figures. USDJPY has since regained some poise as US 10yr yields have drifted back up to 2.37%. Even though the Fed raised its benchmark rate by a quarter percentage point to a target range of 1.25 percent to 1.5 percent and lifted its estimate for growth next year to 2.5 percent from 2.1 percent, it still didn’t see inflation accelerating. Markets are generally interpreting the meeting as a dovish hike. Still to come today, the European Central Bank is expected to reveal details of plans to taper asset purchases. Comments on the outlook for 2018 will be the focus for investors as they weigh the impact of coming policy normalization on global asset prices. We also have the BoE meeting and the Swiss National Bank later. Prime Minister Theresa May suffered a humiliating defeat for her key Brexit law on Wednesday after pro-European members of her own party openly defied her orders in a vote in Parliament. We have a lot of data today and this morning we see French and Spanish CPI, French, German and EU PMI data, UK Retails sales and Swedish Unemployment dat.. Good luck.