Bond yields nudge higher again

The euro and sterling are not much changed against the dollar this morning trading at about $1.1250 and just below $1.34 respectively, while the single currency-pound exchange rate is hovering around the 84p mark

Government bond yields continue to nudge higher with US and UK 10-year yields now up to 1.65% and 1.0% respectively, while equivalent German yields have risen to almost -0.20%

Flash PMIs for the Euro area, UK and US published yesterday showed all three economies  expanding at above-average rates of growth in November with continuing upward pressures on costs and prices

ECB member and Central Bank of Ireland Governor Makhlouf says “we need to recognise that there are risks to the (Euro area) inflation outlook…if current trends in inflation persist, the case for monetary policy action becomes stronger.”

Bank of England MPC member Haskel says “if the (UK) labour market stays tight, (interest rates) will have to rise”, but added that he wants to see more data on whether acute worker shortages are proving persistent

Data due today includes annual PCE inflation in the US, which is expected to have risen further to 5.1% in October (from 4.4% in September) according to the consensus forecast