Themes

• General mood is “risk off”
• Chinese inflation data slightly less than expected
• CEO of RBC says Canada needs to hike rates rapidly and multiple times

What’s Moving

Ultra-quiet session in Asia today, with markets consolidating overnight movements and players still waiting for fresh incentives in the new year.  

Sterling and the AUD both rose a little in Asia, while the rest of the majors held overnight ranges.

There was little to no reaction to slightly worse than expected inflation numbers from China, with CPI printing at +1.5% (from talk of +1.7%) and PPI coming in at +10.3% (from expectations of +11.3%).

Late Asian trade saw the Canadian Dollar take a small big after hawkish comments from the CEO of Royal Bank of Canada.

For tonight, expect continued two-way consolidation of overnight movements with eyes being on the data calendar. Tonight’s session sees:

• Euro-zone Industrial Production (E: +0.1%)
• U.S. CPI: (E: +0.4%)