Fed speak: The Fed's Goolsbee and Bostic continued to push back on the notion of imminent rate cut talks yesterday even if both underscored the recent positive developments on inflation. Goolsbee noted that 'market has gotten ahead of themselves' while Bostic reminded that there 'is not going to be urgency' in easing the current restrictive policy stance. Barkin was more optimistic, as he described the retreat in inflation as 'remarkable', which contrasts his more cautious comments heard in late November. We still think that the Fed is going to cut rates for the first time in March, but given the recent easing in financial conditions and that there are few signs of a clear cooling in economic momentum, we think the Fed will opt for a relatively gradual rate cutting pace of 4x25bp in 2024 (market prices in a total of 145bp of cuts).
Today we get the HICP inflation numbers for the euro area. After yesterday's lower-than-expected Spanish and German prints, consensus expects the euro area figure at 2.5% y/y.