Europe And Silver Second Round TLTRO After The Super Week Market Or Reproduce Crazy

The US dollar index was high in early trading today, and the beautiful nonfarm data last Friday set the US dollar index 5 and a half years high.

According to the data released by the labor department in December 5th, the number of non farm payrolls increased by 321 thousand in November, the highest since January 2012, much better than economists had expected.

The unemployment rate stayed at a six year low of 5.8%, and wages rose the biggest since last June.

The move made the Fed closer to the first rate hike since 2006. In recent weeks, signals from the market showed investors were warming up when and when the Fed tightened monetary policy. According to December 5th data from the US interest rate market, traders bet that the first round of interest rate rises in the first ten years of the Federal Reserve would start in July next year.

Previous reports showed that the increase in non farm jobs in November has raised confidence in the strength of the US economic recovery.

With the additional strong impact of non-agricultural data, the Fed's interest rate resolution after a week and a half is likely to add more attention. Considering that the US Open Market Committee will rotate again next year, the final resolution at the end of this year will be the last performance of many hawkish officials, especially for officials who are retiring next year, such as Fisher and Proso.

Investors are waiting for the December 17th Federal Open Market Committee meeting, but a series of economic data will be released before that, including retail sales in November and wholesale inventory data in October.

The US producer price index in November and consumer confidence in December will also be released this week.

Investors will continue to bet on another important event, that is, when the Federal Reserve will raise interest rates, and US economic data and Fed officials' speeches will provide clues about the pace of recovery and when interest rates will be raised.

The U. S. Department of Commerce was scheduled to release November retail sales data at 21:30 on Beijing time. The median market forecast showed that the monthly rate of retail sales rose in the United States flat in November and 0.3%, and the increase in core retail sales fell to 0.2% from 0.3% last month.

The US economy is recovering strongly, quite different from Europe.

Employment growth in the United States in November has been the largest in nearly three years, and wages have also increased. The data show that economic strength may prompt the fed to raise interest rates ahead of schedule.

Due to the weakness of the global economy, some investors are worried that in the middle of 2015, the US economy may shift from strong growth in the short term to slowing down the pace of expansion, so that inflation rate is lower than the Fed's target level and affect interest rate hike.

This Thursday (December 11th), the European Central Bank will implement the second round of directional long term refinancing operation (TLTRO), which will be crucial to the ECB's future policy decisions: in the speech last week, Delaki, the ECB president, made it clear that it might be possible to wait for the TLTRO to be implemented before deciding whether to expand asset purchases.

Providing these cheap loans to banks is one of the main ways that the ECB will inject funds into the euro area economy. The ECB is likely to follow the steps of the US, Britain and Japan to start the sovereign debt purchase plan.

But Germany is worried that this will encourage Member States to borrow heavily and stimulate inflation.

Before January 22nd next year, the ECB will know the second round of TLTRO absorption, and the ECB will buy several weeks of private sector assets to better understand its balance sheet.

The result of the second round of TLTRO is crucial, and the market is expected to absorb 125 billion euros, which will be consistent with the total absorption of 210 billion euros in the first two rounds, but far below the ECB's initial forecast of 400 billion euros.

If the second round of absorbing capacity is less than 125 billion euros, it will greatly increase the expectation of the European Central Bank to implement further easing action at the beginning of next year, and at the same time will benefit the euro and European bond market and stock market.

Delaki, the European central bank governor, will give the euro zone finance ministers in Brussels on Monday that the unemployment rate near record highs will not replace the reform of fiscal, labour and pension systems.

The latest forecasts of the European Central Bank show that in 2015, the euro area economic growth rate was only 1%, lower than that expected three before three months ago. German industrial production data in October and euro zone December investor confidence index will be announced on Monday. The euro area is still struggling to overcome the sequelae of debt and financial crisis.

Although the ECB's last week's resolution failed, some people were disappointed, but President Delaki made it clear that quantitative easing is expected in early 2015.

Some analysts point out that the euro will soon fall below 1.20 against the US dollar in the first ten years, and the dollar still has plenty of space. In 2015, it will be supported by different monetary policies.

In addition, in Japan, the Liberal Democratic Party led by Andouble may win 300 or more of the 475 seats in the house of representatives in the December 14th elections.

Abe Shinzo is likely to win the next Sunday's election by overwhelming strength. If so, it will boost investor confidence in Japan's economic reform and help Abe's anti deflation plan.

If the re election is a great success, the challenges faced by Andouble's leadership within the party will be reduced and there will be room for undesirable reform initiatives.

Investors' renewed confidence in Andouble economics will continue to give the yen a sell-off and support for Japanese stocks.

Today, the market will also usher in a very crucial test. The US employment market index in November will be released at 23 today. Although this data has only been released publicly for 2 times, it is more coincidental that the two data release days are contrary to the trend of the non farm nights before the weekend.

However, considering that the over 300 thousand performance of the non-agricultural sector is quite different from that of the two previous expectations, it may be difficult for LMCI to turn the market again this evening.

Of course, the risks still deserve investors' attention.