Major European PMI survey suggests the region’s economy is stabilizing


-Mixed European flash PMI data for France, Germany, the eurozone and the UK, but indicated that any slowdown in Europe was likely to be contained or even avoided. Significant GBP/USD exchange rate to the downside following UK PMI; Overnight, Australia’s Jan Flash PMI Manufacturing recorded its first decline in 33 months, while Japan was also weak and recorded its 3rd consecutive decline.

-The UK government borrowed at a record level in December, mainly due to the household energy support scheme and high debt interest costs. The UK government remains stuck between a rock and a hard place (weak finances and widespread public sector industrial action).

-Geopolitically stated German Defense Min Germany is still undecided about Leopard tanks, as NATO Secretary General Stoltenberg warned of a new Russian offensive and a decision on German tanks coming soon. The indecision seems to be creating tension across the block.

– said Finnish foreigner Min Haavisto potential for NATO membership without Sweden After Turkey Pres Erdogan said Finland and Sweden cannot expect Turkey’s support for its NATO application following recent demonstrations outside the Turkish embassy in Sweden
– 3-month Euribor fixing card 2.5% as it continues to hit new decade highs.

-Asia closed mixed with Nikkei225 +1.5%. EU indices are different and slightly lower. US futures are -0.2%. Gold +0.4%, DXY 0.0%; Commodity: Brent -0.4%, WTI -0.5%, TTF -10.6%; Crypto: BTC +0.5%, ETH -0.9%.


– Australia’s Jan Preliminary PMI Manufacturing recorded its first decline in 33 months (49.8 vs. 50.2 previously).

– Australia December NAB Business Confidence: -1 vs -4 previously.

– Japan’s Jan Preliminary PMI Manufacturing recorded its 3rd consecutive decline (48.9 vs. 48.9 previously).

– China said to comment on the US debt issue. It believed that the greatest contribution the United States could make to solving its debt problems abroad was to act in accordance with responsible monetary policy, to deal with its own debt problem and to stop sabotaging the active efforts of other sovereign countries to solve their debt problems.

in Europe

– Many ECB members (including chairwoman Lagarde) reiterate the position to maintain policy.


– The US said it was “confronting” China over companies linked to Russia’s war, suggesting some Chinese state-owned companies may be aiding Russia’s war effort in Ukraine.


– US Energy Secretary Granholm indicated that President Biden would veto the Strategic Petroleum Reserves bill if it passed Congress.

– The US said it would increase pressure on China over Iranian oil. Talks to dissuade Beijing from buying and being stepped up. China is the main destination for Iran’s illegal exports.

Speakers/Fixed Income/FX/Commodities/erratum


Indexes [Stoxx600 +0.03% at 454.60, FTSE -0.37% at 7,756.20, DAX -0.09% at 15,089.65, CAC-40 +0.19% at 7,045.05, IBEX-35 -0.17% at 8,929.22, FTSE MIB -0.03% at 25,814.00, SMI -0.07% at 11,398.40, S&P 500 Futures -0.18%].

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Market focal points/key themes: European indices generally open higher but quickly turned around to trade slightly in the red; outperforming sectors include real estate and consumer discretionary; lower performing sectors are healthcare and telecommunications; Iveco takes control of MIRA; Expected earnings during the upcoming US session include General Electric, 3M, Johnson & Johnson and Raytheon.


– Consumer Choices: Swatch Group [UHR.CH] +2.0% (revenue), Sportech [SPO.UK] +6.5% (trade update).

– Consumer goods: Associated British Foods [ABF.UK] -1.0% (Q1 trading update – confirms 23rd).

– Energy: Technip Energy [TE.FR] -1.0% (awarded contract).

– Finance: Senior plc [SNR.UK] +10.0% (trade update), Saga [SAGA.UK] +3.5% (H2 trade update – better than expected trade).

– Healthcare: Basilea Pharma [BSLN.CH] +3.0% (provisional FY22 – above above), Both [AMBUB.DK] -2.5% (analysts’ action – reduction to sell SEB in Enskilda).

– Industry: Komax [KOMN.CH] +2.0% (provisional year 22 – turnover exceeds estimates), Henry Booth [BOOT.UK] -4.0% (trade update).

– Technology: Rheinmetall [RHM.DE] +1.5% (Germany said it allows other countries to send Leopard tanks to Ukraine).

– Telecom: Ericsson [ERICB.SE] -2.5% (Analyst Action – Cut to Sell Goldman Sachs).


– France Fin Min Le Maire reiterated the position that inflation should decrease from mid-2023.

– NATO Secretary General Stoltenberg announced that Putin was planning new offensives; It is necessary for Ukraine to be able to repulse the offensive soon.

– German Defense Minister Pistorius announced that Ukraine has no new position on Leopard tanks; A positive decision could be taken quickly.

– Turkish President Erdogan announced that after the recent demonstrations outside the Turkish embassy in Sweden, Finland and Sweden cannot expect Turkey’s support for its application to NATO.

Currencies/Fixed Income

– Traders continued to debate whether the Fed’s current hawkish stance was unacceptable given recent weak data. Risk appetite has recently found a foothold as concerns about the global economy’s hard landing eased.

– EUR/USD was steady around 1.0880 as key European January preliminary PMIs were mixed, but indicated that any slowdown in Europe is likely to be limited. The data showed that the region’s economy is stabilizing, which will prompt the ECB to focus on inflation.

– GBP/USD fell 50+ points on the session to test below 1.2350 as UK government borrowing hit a record high in December as inflation pushes up debt payments. The PMI reading also continued to decline as the services component deteriorated more. The data highlighted risks to the economy and dampened expectations for future interest rate hikes.

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– USD/JPY danced around the 130 handle for now.

Economic data

– (FI) Finland December PPI M/M: -0.8% vs. -0.8% previously; Y/Y: 14.5% vs. 18.8% previously.

– (DE) Germany Feb. GFK Consumer Confidence: -33.9 vs. -33.3e.

– (UK) Dec Public Finances (PSNCR): £17.2b vs £20.6b previously; PSNB (former banking groups): £27.4bn vs £17.3be; Central Government NCR: £23.1bn vs £25.5bn previously; Net borrowing: £26.6bn vs £23.2be.

– (CH) Swiss December trade balance (CHF): 2.8 B vs. 2.4 B previously; Real exports M/M: +5.7% vs. -2.7% previously; Real Imports M/M: +0.3% vs. -0.4% previously; Look at exports Y/Y: 5.8% vs 11.0% previously.

– (ZA) South Africa December leading indicator: 123.1 vs 123.0 previously.

– (FR) France Jan Business Confidence: 102 vs. 102e; Production belief: 103 v 102e; Production outlook indicator: -8 v -7e; Own company production outlook: 17# v 17 above.

– (FR) France Jan General Demand Business Survey: 5 vs 13 previously.

– 03:00 (CZ) Czech Jan Business confidence: 5.3 v 3.9 previously; Consumer Confidence Index: -25.3 vs. -32.0 previously; Composite confidence (consumers and business): -0.8 v -3.3 previously.

– (FR) France Jan Provisional manufacturing PMI: # v 49.6e (1st expansion in 5 months) ; Services PMI: 49.2 v 49.7e; Composite PMI: 49.0 v 49.5e.

– (DE) Germany Jan Preliminary manufacturing PMI 47.0 v 48.0e; Services PMI: 50.4 v 49.5e; Composite PMI: 49.7 v 49.7e.

– (EU) Eurozone January preliminary manufacturing PMI: 48.8 v 48.5e; Services PMI: 50.7 v 50.2e; Composite PMI: 50.2 v 49.8e.

– (IC) Iceland Dec. wage index M/M: 4.0% vs. 0.4% previously; Y/Y: 12.4% vs. 8.0% previously.

– (UK) January preliminary manufacturing PMI: 46.7 v 45.4e (6th contraction in a row); Services PMI: 48.0 v 49.5e; Composite PMI: 47.8 v 48.9e.

Fixed income issue

– (ID) Indonesia sold a total of IDR14.5T against a target of IDR14.0T in Islamic notes and bonds (sukuk).

– (EU) The European Union opened its book to sell euro-denominated 3.0% March 2053 bonds through a syndicate; instructions visible +88bps to center.

– (UK) DMO opened book to sell new 3.75% October 2053 gilts via syndicate; Guidance for UK Treasuries is +2.75-3.25bps.

– (NL) Netherlands Debt Agency (DSTA) sold €1.995 billion against a range of €1.0-2.0 billion in 3.00% January 2054 DSL bonds; Average yield: 2.362%.

– (NE) South Africa sold a total of ZAR3.9B against ZAR3.9B specified in the 2030, 2032 and 2035 bonds.

– (AT) Austrian Debt Agency (AFFA) sold a total of 1.55 billion euros against 2.0 billion euros indicated in the 3-month and 6-month invoices.

Looking ahead

– (NG) Central Bank of Nigeria Interest Rate Decision: The key rate is set to increase by 50 basis points to 17.00%.

– (IL) Israel December leading ‘S’ indicator M/M: no est vs 0.1% ago.

– 05:15 (CH) Switzerland sells 3-month bills.

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– 05:25 (EU) Daily ECB liquidity statistics.

– 05:30 (DE) Germany to sell €1.5bn 0.00% October 2025 green BOBL.

– 05:30 (HU) Hungarian Debt Agency (AKK) to sell 3-month bills.

– 05:30 (EU) ECB allocation in 7-day main refinancing auction (MRO).

– 06:00 (UK) Jan CBI Industrial Trends Total orders: -9e v -6 previously; Sale prices: No est v 52 prior; Business optimism: No est v -48 above.

– 06:45 (US) Daily Libor Fixing.

– 07:00 (RU) Russia’s announcement of the upcoming OFZ bond issue (takes place on Wednesday).

– 07:00 (BR) Brazil Mid-January IBGE Inflation IPCA-15 M/M: 0.5%ev 0.5% pre; Y/G: 5.8%ev 5.9% previously.

– 07:00 (CL) Chile Dec PPI M/M: No est v 0.0% before.

– 08:00 (HU) Interest rate decision of the Central Bank of Hungary (MNB).: The base rate is expected to remain unchanged at 13.00%.

– 08:00 (PL) Poland Dec M3 Money Supply M/M: 0.8%ev 0.5% in advance; Y/G: 5.9%ev 5.6% previously.

– 08:00 (NG) Central Bank of Nigeria (CBN) Gov. Emefil press conference ahead of rate decision.

– 08:00 (UK) Daily Baltic Dry Mass Index.

– 08:30 (US) Jan Philadelphia Fed Non-Manufacturing Regional Index: None est v -12.8 ago (revised from -17.1).

– 08:55 (US) Weekly Redbook LFL Sales Data.

– 09:00 (HU) Hungarian Central Bank (MNB) press conference after rate decision.

– 09:45 (US) January preliminary S&P/Markit manufacturing PMI: 46.0ev 46.2 pre; Services PMI: 45.0ev 44.7 above; Composite PMI: 47.0ev 45 ago.

– 10:00 a.m (US) Jan Richmond Fed Manufacturing Index: -5e v+ 1 up.

– 11:30 (CH) SNB Schlegel.

– 11:30 a.m. US) Treasury to sell 52-week notes.

– 1:00 PM US) Treasury to sell 2-year notes.

– 14:00 (AR) Argentina Nov. economic activity index (monthly GDP) M/M: No est v -0.3% previously; Y/J: No, compared to 4.5% previously.

– 16:30 (US) Weekly API oil inventories.

– 16:45 (NZ) New Zealand Q4 CPI Q/Q: 1.3%ev 2.2% pre; Y/G: 7.1%ev 7.2% previously.

– 18:30 (AU) Australia Dec Westpac Lead Index M/M: No est v -0.1% prev.

– 19:30 (AU) Australia Q4 CPI Q/Q: 1.6%vs 1.8% prev; Y/G: 7.6%ev 7.3% previously.

– 19:30 (AU) Australia Dec CPI Y/Y: 7.7%ev 7.4% prev; CPI inverted average Y/Y: 5.8%vs 5.6% previously.

– 20:10 (JP) BOJ direct bond purchase operation for 1-3 years; 3-5 years; 5-10 years and 10-25 years.

– 20:30 (KR) The Bank of Korea (BOK) will sell 3-month monetary stabilization bonds (MSB).

– 21:00 (NZ) New Zealand December Credit card spending M/M: No est v -2.6% upfront; Y/Y: No, compared to 16.0% previously.

– 21:00 (SL) Central Bank of Sri Lanka (CBSL) Interest Rate Decision: Key rates expected to remain unchanged.


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