FX Daily Update
The National Bank of Canada | Dec 14, 2016 12:37AM ET
The Trump effect on markets
A wave of optimism appears to be washing over stock markets this morning, with our screens aglow in green for European markets and all signs pointing to a bullish opening in North America. U.S. indexes may be reflecting a measure of hope that President-elect Trump will deliver on the promised fiscal easing. In a somewhat contradictory movement however, we are also seeing a steepening in the U.S. yield curve based on anticipations of tighter U.S. monetary policy.
Turning to oil, West Texas Intermediate is stabilizing after gaining close to 5% yesterday. According to the most recent analysis, the plan by OPEC and its “partners” (if it comes to pass) will result in a crude oil supply deficit in the second half of 2017.
In the meantime, China has announced that Retail Sales climbed by an annualized 10.8% in November, which would be the strongest growth since December 2015. Certainly another reason for markets to get into the festive spirit…
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