Financial Markets Daily Report
28 January 2022

In yesterday’s session investors continued to digest the outcome of the Fed’s meeting and received positively the US 4Q GDP data (up by 1.7% qoq).

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  • In yesterday’s session investors continued to digest the outcome of the Fed’s meeting and received positively the US 4Q GDP data (up by 1.7% qoq, see our take here).
  • Amid a rise in volatility, stock indices edged up in the euro area and declined in the US. In fixed income markets, the US Treasury curve continued to flatten, with the short-term rising while, in the euro area, peripheral spreads narrowed and core yields edged up modestly.
  • In FX markets, the USD strengthened against most currencies, nearing $1.11 against the EUR (lowest since mid-2020).
  • Today’s focus will be on the European Commission economic sentiment indicators for January and on 4Q GDP data releases (for Spain and France we already know that GDP grew by 2.0% and 0.7% qoq, respectively). In Italy, the parliament is still in process for electing a new President while Portugal will hold a general election this Sunday.
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