This week's holiday-shortened economic calendar is relatively light, as investors will focus on Washington D.C. with President-elect Trump assuming office on Monday. For us, the Day One Presidential orders might be related to immigration, energy & deregulations. In economic data last week, core CPI came lower than market estimates at 0.22% MoM (our estimate was 0.27%). As a result, we have reduced our core PCE estimate to .21% MoM for Dec’24. In auction supply there is only 33 BN USD of UST supply. Initial jobless claims is continued to come modest around 220k but existing home sales no could be strong at 4.2 MN. Fed speak has been dovish in last week, with Governor Waller being the most dovish. Even Williams was optimistic on inflation. Whether it is their way of caging down runaway UST yields or getting closer to Trump's new administration, only time might tell. In RoW, Canada might see a Dec CPI reading of -.2% MoM (YoY boosted higher to 2.1%) which is unfavorable for BoC. In Eurozone, flash PMIs might come a tad better and in UK, the most important fiscal deficit data for Dec'24 might just push gilt yields higher.
