EUROPEAN SESSION
In the European session, the main highlight is the Swiss CPI report. The CPI Y/Y is expected at 0.0% vs 0.1% prior. The data isn’t going to change anything for the SNB as policymakers have repeatedly stated that the bar for negative interest rates remains very high and they won’t move even if they get a couple of deflationary readings (which is what they expect in the coming months). As a reminder, the SNB threatened to intervene on Monday triggering a strong selloff in the Swiss Franc. We will also get the final services PMIs for the major Eurozone economies and the UK, but these won’t matter at all.
AMERICAN SESSION
In the American session, the highlights include the US ADP and the US ISM Services PMI. The ADP is expected at 50K vs 22K prior. The weekly ADP data has been showing stabilisation in the labour market, so we can expect a good reading today. The US ISM Services PMI is expected at 53.5 vs 53.8 prior.
Contrary to consensus, the US economic activity has been picking up steadily in the final part of last year and especially at the start of 2026. The ISM Manufacturing PMI on Monday was a testament to that. The only problem is that inflationary pressures remain high. The market focus right now is on the US-Iran war as that could have serious implications for the economy via higher energy prices
