S&P confirms EU's AAA; terms for Greek default not finalised

What a week we have ahead of us with plenty of companies reporting, President Obama will give his State of the Union speech, the Federal Reserve will meet followed by a Bernanke press conference, and the US will release the first take on 4Q'11 GDP, which is currently tracking around 3 percent quarter-on-quarter at an annualised rate. We edge into the week, however, with Eurozone Consumer Confidence, three French auctions and earnings from Texas Instruments and CSX, among others.


European Union keeps triple-A rating while terms over a Greek default have not yet been approved: As discussed yesterday by our Chief Economist Steen Jakobsen the Greek PSI has still not been solved and talks have been postponed to the EU summit on January 30. Some good news about the EU came during the weekend, however, as Standard & Poor's confirmed its triple-A rating on the EU and removed its "CreditWatch negative" status as well. This comes despite a string of downgrades by S&P earlier this month, which saw France and Austria lose their top rating. S&P stated that the "supranational entity known as the EU benefits from multiple layers of debt-serve protection sufficient to offset the current deterioration we see in member states' creditworthiness".

Eurozone Consumer Confidence to remain weak: Consumers in the beleaguered Eurozone do not have much to cheer about at the moment, which is reflected in the Consumer Confidence survey, which has tanked to -21.1 in December from a post-recession high of -9.4 in November 2010. Consensus looks for the survey to weaken even further in the first report from 2012 with a -21.4 forecast. Before that Canadian Leading Indicators will have been released; here consensus targets a 0.6 percent rise in December following a 0.8 percent rise in November.