A light trading session beckons in Europe as the year begins to wind down | Forexlive

The dollar staged a slight bounce towards the end of last week following comments by NY Fed president, John Williams, here. One can argue whether or not it is taken out of context but it speaks to the stretched positions in markets in recent weeks. And if anything else, it is a good excuse as any for profit-taking before year-end.

The dollar is lightly lower so far in what should be a quieter trading day ahead. There isn’t much on the agenda in Europe today and in fact, for the rest of the year. For this week itself, markets should only be left focusing on the BOJ policy decision and not much else. There is also Canadian and UK inflation reports to scrutinise but in all likelihood, this is a week where markets will begin to wind things down; barring any shock headlines that is.

In the bigger picture, Treasury yields remain pinned down with 10-year yields still below 4% and equities are staying in a good spot with both European and US major indices looking to end the year at the highs. That is a tell on what traders are looking for on the outlook, especially on rates, heading into next year.

0900 GMT – SNB total sight deposits w.e. 15 December
0900 GMT – Germany December Ifo business climate index

That’s all for the session ahead. I wish you all the best of days to come and good luck with your trading! stay safe out there.