Sentiment Stabilises

Risk has got some reprieve after Friday rout as reports surrounding the Omicron variant of the Covid-19 virus have helped soothe the nerves, despite an expected raft of flight bans implemented over the weekend. Two South African health experts suggested that the symptoms caused by the new variant have been mild so far. The WHO have urged caution on that front, but also confirmed that the current PCR tests can detect infection with Omicron. Meanwhile, vaccine developers are racing to produce an adjusted product, with Moderna noting that they could release an updated vaccine as soon as early next year.

• Safe haven currencies JPY and CHF have been offered, albeit they already trade off earlier lows. USD/JPY bounced from its 50-DMA, which limited losses last Friday.
• EUR trades on a softer footing, underperforming most of its G10 peers. The Eurozone's single currency has been under pressure as ECB officials reiterated that inflation is likely tied to temporary factors.
• Riskier currencies have regained poise. A recovery in crude oil prices has likely lent some support to that space.
• German preliminary CPI data, Swedish GDP & final EZ consumer confidence headline today's data docket. There is plenty of central bank speak coming up from members of the Fed, ECB & Riksbank.