NORWAY: Manufacturing Industrial Momentum Soft Throughout 2024
Norwegian manufacturing industrial momentum remains soft, with 3m/3m SA growth at -0.8% (vs -1.7% in November). The increase in industrial confidence in the Q4 Business Survey and a still-expansionary manufacturing PMI should support a gradual improvement in outcomes through the course of 2025, particularly as Norges Bank start easing policy.
- In December, manufacturing production rose 3.2% M/M (vs 1.2% prior) and 5.0% Y/Y (vs 1.4% prior), led by the oil refining, chemical and pharmaceutical industry (which faced production challenges in October and December).
- Headline IP was supported by the petroleum industry throughout 2024, underscored by strong investment growth.
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STIR: Just Over 100bp Of ECB Cuts Still Priced Through '25
Light dovish moves in EUR STIRs fade as the recovery from Tuesday/Asia lows in Bunds moderates, with the bulk of the late ‘24/early ’25 hawkish repricing holding.
- ECB-dated OIS flat on the day, showing ~102.5bp of cuts through year-end, with the next 25bp move almost fully discounted come the end of this month’s decision.
- Euribor futures -0.5 to +1.5. Only ERH5 has pierced its November low in recent sessions.
- Comments from ECB’s Villeroy are due this evening, with lower tier Eurozone data (confidence metrics and PPI) scheduled this morning.
- That will leave much of the focus on the long end and U.S. data (ADP employment and weekly jobless claims).
ECB Meeting | €STR ECB-Dated OIS (%) | Difference Vs. Current Effective €STR Rate (bp) |
Jan-25 | 2.674 | -24.4 |
Mar-25 | 2.405 | -51.3 |
Apr-25 | 2.221 | -69.7 |
Jun-25 | 2.076 | -84.2 |
Jul-25 | 2.024 | -89.4 |
Sep-25 | 1.952 | -96.6 |
Oct-25 | 1.918 | -100.0 |
Dec-25 | 1.893 | -102.5 |
GOLD TECHS: Gains Considered Corrective
- RES 4: $2762.3 - High Nov 1
- RES 3: $2730.4 - 76.4% retracement of the Oct 31 - Nov 14 bear leg
- RES 2: $2726.2 - High Dec 12
- RES 1: $2665.3/2692.8 - High Jan 3 / High Dec 13
- PRICE: $2653.2 @ 07:24 GMT Jan 8
- SUP 1: $2596.2/2583.6 - Low Dec 30 / 19
- SUP 2: $2564.4 - Low Nov 18
- SUP 3: $2536.9 - Low Nov 14 and a key support
- SUP 4: $2511.1 - Low Sep 12
A bear threat in Gold remains present despite the latest recovery. The yellow metal traded sharply lower on Dec 18 and the move undermines a recent bull theme. A resumption of weakness would open key support at $2536.9, the Nov 14 low. The first firm support to watch is $2583.6, the Dec 19 low. On the upside, a strong climb would instead signal scope for a climb towards resistance at $2726.2, the Dec 12 high.
BUNDS: Finding support ahead of the 2.50% Yield level.
- Bund has so far found some support just ahead of the 2.50% Yield level, the future would have needed another 12 ticks down to 131.78, instead finding support at 131.90 (20 Day EMA) Yesterday, and also Overnight.
- The 10yr Yield printed a 2.489% high Yesterday following the strong US Data (JOLTS, ISM).
- The German Factory orders and retail sales saw a miss vs consensus, but this was hardly a market mover, with Bund just gaining 7 ticks on the release up to 12 ticks in the following 10 minutes since the release.
- Support will again be at the 2.50% level in Yield term, while resistance is seen at 132.57, followed by 132.71, and 133.08.
- It is a lighter day on the Data front out of Europe, early focus will again be on supply.
- Out of the US, ADP, IJC and final Wholesales Inventories are the notable releases, while the FOMC minutes are also scheduled, but unlikely to be a mover.
- SUPPLY: UK £4.25bn 2030 (Equates to 19.6k Gilt) could weigh, German €5bn Bund (equates to 41.26k Bund) should weigh into the bidding deadline. US sells $22bn of 30yr re opening.
- SPEAKERS: Fed Waller, ECB Villeroy.
- SYNDICATION: Italy Dual Tranche.
