Dollar rockets up!

Overall good news came out of the US and bad news out of the UK yesterday.

Dollar and US yields benefitted yesterday from the stronger US empire state manufacturing index which came out at 10.57 from -11.14 last month.

US Industrial production and core CPI pushed back up to 0.8% y/y from 50-year lows of 0.6% y/y previously.

EURUSD was under pressure for most of the session after Moody's put Spain's Aa1 ratings on watch for a possible downgrade and S&P continued to be negative on Belgium.  The Irish government passed the EU/IMF bailout package of 85bln EUR as expected. However, fears persist as Portugal's finance minister said the government is taking additional measures so as not to resort to a bailout.

The pound was weaker overnight with rumoured sovereign buying of EURGBP. UK Nov. claimant count jobless came out worse at -1.2k vs consensus of +3.0k. 

Data Today:

German PMI Manufacturing – 8.30am GMT

German PMI Services – 8.30am GMT

Eurozone PMI Manufacturing – 9am GMT

Eurozone PMI Services – 9am GMT

Eurozone CPI – 9am GMT

UK November Retail Sales – 9.30am GMT

US Initial Claims -1.30pm GMT

US housing starts – 1.30pm GMT

US Philadelphia Fed – 3.00pm GMT