Main exchange rates steady

The main exchange rates are relatively steady this morning with the euro and sterling trading in and around $1.2150 and $1.3650 against the dollar respectively, while the pound is hovering just above 89p against the single currency though it did briefly strengthen to just below this level yesterday

European and US equity markets ended largely flat yesterday while core bond yields nudged down further, with US 10-year yields closing at 1.08% (10bps off their high of earlier this week) and equivalent German yields falling to -0.53%

Fed members Clarida and Brainard both indicate that the Fed’s bond purchases will continue at the current pace (of $120bn per month) for some time yet, as the US economy is still some distance from the central bank’s employment and inflation goals

Industrial production in the Euro Area rose for a seventh month in a row in November, increasing by 2.5% from October, although it was still marginally below its level in the same month in 2019

The House of Representatives has voted to impeach Donald Trump (as expected). The process now heads to the Senate, though the Republican leader of that chamber, Mitch McConnell, has said he will block starting an impeachment trial before Joe Biden takes office on January 2020

Data due today includes jobless claims and import prices in the US