US: House Of Reps To Vote On Bipartisan Housing Legislation Monday

Italy flash HICP printed in line with consensus at 1.2% Y/Y in December (vs 1.1% Nov), alongside the softer-than-expected Eurozone flash print. The rise was mainly driven by strength in food and services (which looks to have been led by transport services), partially offset by declines in energy and non-energy industrial goods.

• Month-on-month, headline HICP partially rebounded 0.2%, also in line with expectations (vs -0.2% Nov).
• Core HICP as defined by Eurostat (excl energy, food, alcohol and tobacco) grew slightly to 1.8% Y/Y (vs 1.7% Nov).
• Services HICP rose to 2.7% Y/Y (vs 2.6% Nov). This looks to have been driven mainly by services within transport (with the mixed-used transport category up to 0.6% Y/Y from 0.1% Nov), and within miscellaneous goods and services (3.3% Y/Y from 3.1% Nov), while all other COICOP divisions feeding into services saw declines (notably communication fell to -5.3% Y/Y from -4.7% Nov, while restaurants and hotels dropped to 3.0% Y/Y from 3.5%).
• Food, alcohol and tobacco saw a notable rise to 2.6% Y/Y (vs 1.9% Nov), which was driven mainly by unprocessed food at 2.6% Y/Y from 1.2% in Nov, though noting that December 2024 saw a 0.5% M/M drop in food and non-alcoholic beverages. Alcohol and tobacco saw a more muted 0.2ppt rise to 2.1% Y/Y.
• Non-energy industrial goods dipped to 0.4% Y/Y (vs 0.5% Nov), mostly driven by clothing and footwear, which fell to 0.7% Y/Y (vs 1.0% Nov).
• Energy HICP fell to -4.5% Y/Y (vs -4.2% Nov), due to largely expected decreases in prices of regulated energy products.

• US TSY 17W AUCTION: NON-COMP BIDS $542 MLN FROM $69.000 BLN TOTAL

• RES 4: 113-00+ 61.8% retracement of the Nov 25 - Dec 10 bear leg
• RES 3: 112-31   High Dec 18 and key short-term resistance 
• RES 2: 112-25+ High Dec 30 / 31 
• RES 1: 112-19+/22 50-day EMA/High Jan 7
• PRICE:‌‌ 112-15 @ 15:59 GMT Jan 7
• SUP 1: 112-01+/111-29 Low Dec 23 / 10 and the bear trigger
• SUP 2: 111-19   1.236 proj of the Oct 17 - Nov 5 - 25 price swing
• SUP 3: 111-11   1.382 proj of the Oct 17 - Nov 5 - 25 price swing 
• SUP 4: 111-00   Round number support 

Treasuries continue to trade above key support at 111-29, the Dec 10 low and bear trigger. An early rally briefly topped the 112-19+ 50-day EMA before prices quickly reversed. This keeps the trend set-up bearish and a breach of 111-29 would confirm a resumption of the bear cycle. This would open 111-19 initially, a Fibonacci projection. On the upside, key short-term resistance is unchanged at 112-31, the Dec 18 high, where a break would undermine a bear theme and signal scope for a stronger recovery instead.