Weekly Focus Fiscal cliff negotiations will go to the edge doc

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Investment Research




Market movers ahead
• Market attention is likely to centre on the fiscal cliff negotiations, as the deadline is
moving closer. President Barack Obama and House speaker John Boehner still have
five days after Christmas to strike a deal but it is possible that the US will go ‘over the
cliff’.
• We expect some improvement in the ISM and a decent employment figure, when
these are released in the first week of the new year.
Global update
• Data in the euro area has started to surprise on the upside. This week it was the
German ifo figures that signalled improvement going forward.
• The Liberal Democratic Party won a landslide victory in Japan. The new prime
minister’s first priority will be to push Japan out of recession with additional fiscal
easing and increased pressure on the Bank of Japan for more aggressive QE.
• The Riksbank cut the leading interest rate by 25bp to 1% as expected. Looking ahead,
we expect the Riksbank to deliver another rate cut in April.
• Norges Bank kept rates unchanged. We expect Norges Bank to hike rates twice in the

course of 2013.
Focus
• Nordic Outlook - December 2012, 20 December. The Nordics are all true triple-A
characterised by strong fundamentals.
• Denmark is heading for moderate growth – a fully fledged recovery is a long way off.
The Swedish economy is set for lower growth and we expect unemployment to
increase due to weakness in exports.
• Norway is still growing at a strong rate but the non-oil industry is under pressure and
the housing market is beginning to give cause for concern. Finland is on the verge of
recession and growth is not likely to pick up much in the near future.
• We wish all our readers a Merry Christmas and a Happy New Year
Euro area leading indicators have
bottomed

US employment is improving

98 00
02 04 06
08 10
12
25
30
35
40
45
50
55
60
65
-75

-50
-25
0
25
50
75
100
125
Index
Index
<< ZEW expectations
Ifo expectations (minus 50) >>
PMI manufacturing >>


00 02 04 06 08 10
12
-800
-600
-400
-200
0
200
400
-800
-600
-400
-200
0
200

400
1000 persons
1000 persons
MoM
Private payrolls, 3 mth avg.

Source: Reuters EcoWin, Danske Bank Markets Source: Reuters EcoWin, Danske Bank Markets


21 December 2012

Important disclosures and certifications are contained from page 21 of this report.
Editors

Allan von Mehren
+45 4512 8055


Steen Bocian
+45 45 12 85 31

Weekly Focus
Fiscal cliff negotiations will go to the edge

Contents
Market movers ahead 2

Global Update 6

Scandi update 8

EMEA Update 9

Latest research from Danske Bank 10

Rates: The outlook for 2013 11

FX: More dollar and yen weakness in
2013 12

Credit: Happy (Holi)days 13

Financial views 14

Macroeconomic forecast 16

Financial forecast 17

Calendar – Key Data and Events in
Week 52 18

Calendar – Key Data and Events in
Week 1 19



Financial views
Major indices
21-Dec 3M 12M
10yr EUR swap 1.62 1.75 2.15

EUR/USD 132 134 132
21-Dec 6M 12-24M
S&P500 1444 -5% to +5% 5%-10%

Read more on Page 17
Source: Danske Bank




2 | 21 December 2012
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Weekly Focus











Weekly Focus
Market movers ahead
Global

Two releases will dominate the US calendar in the next two weeks – the ISM
manufacturing index and the December employment report
• The employment report is due for release Friday after New Year and includes both the
, both released after New
Year. The Markit PMI has been above the ISM in the last couple of months and the
flash PMI increased substantially in December. It will be interesting to see if the ISM
index increases to reduce this gap. We expect at least some improvement in the ISM
but we need some more data to make our final estimate. The ISM report should also
bring some indications of how the fiscal cliff debate has affected business sentiment.
change in payrolls and the unemployment rate
• Also of very high interest in the first week of 2013 is the release of the
. The distortions from Hurricane Sandy
seem to have faded and the jobless claims are now below their pre-Sandy level. This
indicates that we should get another decent employment report with a relatively large
addition to payrolls.
minutes from
the December FOMC meeting
• Between Christmas and New Year’s eve there are only few releases with the
. As the FOMC at the December meeting introduced
numerical threshold values for inflation and unemployment to be used as an interest
rate tool, the minutes will be of special interest. They should give some insight in how
the threshold values have been decided and what considerations different members of
the committee have made.
Conference board consumer confidence
• Finally and possibly the most interesting, the US will go over the
as the most interesting one. We expect
consumer confidence to fall from 73.7 to 70.0, thereby mirroring the drop in the
Michigan measure of consumer sentiment. Consumer sentiment is likely to be
affected by the fiscal cliff negotiations, where the outcome might be an increase in
income taxes.

fiscal cliff
• In the euro area little is happening during the Christmas holiday. German
on 31
December if no agreement is reached. We will therefore follow the negotiations to see
if a solution is found before the deadline.
retail sales
are expected to have improved decently in November after a sharp October decline.
French
final Q3 GDP figures are released on 28 December. No surprise outcome
expected. A
Christmas speech by Merkel is broadcast on 25 December and a new year
speech on 31 December. Next year we start out with final December PMIs, which are
expected to confirm signs of modest improvement. German and euro area
inflation
data will probably not be that exciting as ECB governor Mario Draghi shows little
concern about inflation and all data signal that he has no reason to be – at least for
now. We might see a pick-up in German core inflation in the medium term though, as
money growth has gained substantial momentum.
Euro area M3 might send more
signals of a pick-up in growth. German
unemployment

may have stabilised in
December after eight consecutive months of increasing unemployment.
Money growth signals growth pick-up
96
98
00
02
04 06

08
10 12
-2.0
-1.5
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
-13
-9
-5
-1
3
7
11
15
19
% y/y
% q/q
M1 growth, 6 month lead
Euro area GDP

Source: Reuters EcoWin


Will ISM close the gap?
08

09
10
11
12 13
30
35
40
45
50
55
60
30
35
40
45
50
55
60
Index
ISM
Markit Flash PMI
Index

Source: Reuters EcoWin



Employment on the way up
00 02 04 06 08 10 12
-800

-600
-400
-200
0
200
400
-800
-600
-400
-200
0
200
400
1000 persons
1000 persons
MoM
Private payrolls, 3 mth avg.

Source: Reuters EcoWin



German unemployment increased
'000 persons
Jan
Apr
Jul
Sep
Dec
Mar

Jun
Sep
11 12
-50
-40
-30
-20
-10
0
10
20
-50
-40
-30
-20
-10
0
10
20


Source: Reuters EcoWin





3 | 21 December 2012
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Weekly Focus











Weekly Focus

• In China the main focus will be the manufacturing PMI, which we expect to confirm
growth in manufacturing activity. The flash estimate for HSBC manufacturing PMI
already released improved to 50.9 in December from a final reading of 50.5 in
November. It should be remembered that the sample used for the December flash
estimate was collected very early in December and was relatively small and for that
reason we would not be surprised if the final estimate for the HSBC manufacturing
PMI is revised higher. We expect the
NBS manufacturing PMI
• Focus in Japan will be on the political developments after the landslide victory for
the Liberal Democratic Party (LDP) in connection with the Lower House election last
weekend. The new prime minister and the new LDP-led government will be
inaugurated on 26 December and in the financial markets there will be particular
interest in who will get the economic portfolio in the new government. Former prime
minister Taro Aso is rumoured to be Abe’s first choice as finance minister. A flood of

economic data for November will also be released between Christmas and New Year.
We expect
in December to
improve 51.3 from 50.6 in November, broadly in line with the HSBC manufacturing
PMI.
industrial production to decline -1.1% m/m in November after increasing
1.6 m/m in the previous month. Production plans suggest that industrial production
will recover markedly in December, so the overall picture is that industrial production
has started to stabilise in late 2012. This should also be evident in the
JMMA/Markitt
manufacturing PMI, which we expect to stabilise in December. However, we expect
the
labour market data for November to be weak as the contraction in GDP in Q3 and
Q4 increasingly weighs.
CPI inflation
Scandi
is also expected to ease from 0.0% y/y to -0.1%
y/y underscoring that Japan is still far from achieving its current inflation target.
• In Denmark the first Friday of the New Year brings figures for gross unemployment.
We do not think growth is currently high enough to stabilise the labour market and
therefore expect an increase of 1,000 to 166,500. The same day brings figures for the
Nationalbank’s
foreign exchange reserves, which will be interesting to follow because
the bank is expected to intervene to the tune of DKK5-20bn before raising rates
unilaterally. The data will thus give an indication of whether a rate increase is
imminent. The previous day sees the release of
manufacturing sentiment
• There will be another batch of important Swedish data over the next two weeks.
November
, which we

expect will fall from 2 in November to 0 in December, pulled down primarily by non-
oil exports and industrial production, both of which have fallen in the last two
releases.
trade balance and retail sales
• After New Year, December
both have bearing on Q4 GDP and should
serve to confirm negative growth (q/q). Plunging December consumer confidence
suggest that retail sales may be quite weak. The chart shows higher perceived risk of
being unemployed (red line) against retail sales growth (blue). The key issue with
these figures is whether they indicate that growth will be in line with the Riksbank
forecast (-0.2 % q/q) or not. We forecast a weaker number, hence expect some
support for that view.
manufacturing and services PMI
•

are released. German
manufacturing PMI has stabilised, implying the very depressed Swedish ditto may
show some upward correction. Swedish services PMI also appears set for a small
upward correction. The uncertainty here is whether the sagging labour market will
continue to weigh on this sector.
Manufacturing PMIs is expected to
improve further in December
07 08
09
10
11
12
40
45
50

55
60
-4
-2
0
2
4
6
8


<< HSBC manf. PMI
% 3m/3m
<< NBS manf. PMI
Diffusion
Industrial production >>

Source: Danske Bank Markets

•

Unemployment expected to increase
given the current growth outlook
07
08
09 10
11
12
60
80

100
120
140
160
180
60
80
100
120
140
160
180
,000 persons
,000 persons

Source: Reuters EcoWin



Weaker retail sales ahead

Source: Macrobond





4 | 21 December 2012
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Weekly Focus











Weekly Focus
• November household lending
• Economic data will be thin on the ground in Norway over the Christmas period. The
new year brings the
growth is likely to have remained at 4.5 %, where it has
flattened out over the past couple of months. This growth rate is still too high to
stabilise the household debt ratio, currently at about 170 % of DI and the main
restriction on additional monetary easing.
PMI
Market movers ahead — Week 52
for December, which will give us a better picture of the state
of the Norwegian industry at the close of the year. Having been very volatile over the
summer, the PMI has stabilised towards the end of 2012, tending towards a gradual
brightening of the outlook for Norwegian manufacturers. In November the index
moved above the critical level of 50 (separating growth from contraction) for the first
time since May. The underlying data were somewhat less encouraging, though, with a

fall in the new orders index and a rise in the inventories index. This may mean that the
potential for a further increase in the PMI in December is limited. On the other hand,
there are signs that global industrial indicators have stabilised or improved in
December, potentially reducing the negative contribution from export markets. The
domestic market is still being driven by oil-related industries but activity levels, while
still high, were probably somewhat lower towards the end of the year. We therefore
expect the PMI to be largely unchanged in December at 50.0.
Global movers
Event Period Danske Consensus Previous
Mon 24-Dec
Tue 25-Dec
Wed 26-Dec 14:30 USD Initial jobless claims 1000 366 361
16:00 USD Consumer confidence Index Dec 70.0 70.0 73.7
16:00 USD New home sales 1000 (m/m) Nov 374 (1.5%) 380 (3.3%) 386 (-0.3%)
Thurs 27-Dec 0:15 JPY Markit/JMMA manufacturing PMI Index Dec 46.5 46.5
0:30 JPY Unemployment rate % Nov 4.3% 4.2% 4.2%
0:30 JPY Job-to-applicant ratio Nov 0.79 0.80 0.80
0:30 JPY CPI - national ex. fresh food y/y Nov -0.1% -0.1% 0.0%
0:50 JPY Industrial production, preliminary m/m| y/y Nov -1.1%| 1.6%|-4.5%
8:45 FRF GDP, final q/q|y/y 3rd quarter 0.2%| 0.2%|0.1% 0.2%|0.2%
15:45 USD Chicago PMI Index Dec 53.6 51.0 50.4
16:00 USD Pending home sales m/m Nov 0.0 % -0.5% 5.2%
Scandi movers
Event Period Danske Consensus Previous
Thurs 27-Dec 9:30 SEK Trade balance SEK bn Nov 8.0
9:30 SEK Retail sales s.a. m/m| y/y Nov -1.7%|1.2%

Source: Bloomberg and Danske Bank Markets

Recovery in industry

Source: Reuters EcoWin





5 | 21 December 2012
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Weekly Focus











Weekly Focus
Market movers ahead — Week 1
Global movers
Event Period Danske Consensus Previous
Mon 31-Dec 2:45 CNY HSBC manufacturing PMI Index Dec 51.2 50.9 50.5

20:10 DEM Merkel's New Year speech
Tue 01-Jan 2:00 CNY NBS PMI manufacturing Index Dec 51.0 51.0 50.6
Wed 02-Jan 10:00 EUR PMI manufacturing, final Index Dec 46.3 46.3
10:30 GBP PMI manufacturing Index Dec 49.0 49.1
16:00 USD ISM manufacturing Index Dec 49.5
Thurs 03-Jan 9:30 SEK Household Lending % Nov 4.5% 4.5%
9:55 DEM Unemployment rate % Dec 6.9%
10:00 EUR M3 money supply y/y Nov 3.5% 3.4% 3.1%
14:15 USD ADP employment 1000 118
20:00 USD Minutes from FOMC meeting
Fri 04-Jan 9:55 DEM PMI services, final Index Dec 52.1 52.1
10:00 EUR PMI composite, final Index Dec 47.3 47.3 47.3
10:30 GBP PMI services Index Dec 50.2 50.2
11:00 EUR CPI estimate y/y Dec 2.3% 2.2%
14:30 USD Nonfarm payroll 1000 Dec 146
14:30 USD Unemployment Dec 7.7%
16:00 USD ISM (NAPM) non-manufacturing Index Dec 54.7
Scandi movers
Event Period Danske Consensus
Wed 02-Jan 8:30 SEK PMI Index Dec 43.2
16:00 DKK Currency reserves DKK bn Dec 512.1
Thurs 03-Jan 9:00 NOK PMI Index Dec 50.1
Fri 04-Jan 9:00 DKK Gross unemployment s.a. K (%) Nov 166.500 (6.4%) 165.500 (6.3%)
9:00 DKK Confidence indicator, industry Index Dec 0 2

Source: Bloomberg and Danske Bank Markets

6 | 21 December 2012
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Weekly Focus
Global Update
US: Merry Cliffmas
Despite progress in negotiations, the US Congress failed to pass legislation that averts the
significant fiscal tightening about to hit th e US economy on 1 January if nothing is
done. President Obama and House speaker Boehner still have five days after the
Christmas holiday to strike a deal but the clock is ticking. Thursday night Boehner
dropped a House vote on his so-called Plan B, which included tax hikes for those earning
more than USD1m per year, and the Congress has now left for Christmas holiday but will
return on December 26. There is still time for Obama and Boehner to reach a
comprehensive mega-deal, which includes a solution to the immediate fiscal cliff issue
for 2013, a framework for spending cuts over the coming decade and an increase of the
debt ceiling about to be hit in February/March next year. However, a just as likely
scenario is that we get a mini-deal, which will bridge the fiscal cliff by extending the
Bush tax cuts for the majority of American households and indexing the AMT for
inflation, but which does not include raising the debt ceiling or a framework for the
longer-term budget. This will ease the immediate fiscal blow to US households but will
leave political uncertainty high, as politicians will face another round of fierce
negotiations in February or March when the debt ceiling becomes binding.
Turning to economic data received over the past week, it has generally been good. The
housing market continues to show higher activity and rising prices. In the manufacturing
sector the December flash PMI jumped to 54.2 from 52.8 and the details were good. This
stands in stark contrast to the below-50 reading on the ISM for November. Which of the
two surveys is right is too early to say but the jump in the Philly Fed survey for December
does suggest that the ISM is likely to move above 50 again in December.
Europe: leading indicators signal improvement

The data released the past couple of weeks continue to surprise to the upside in the euro
area. The euro area surprise index has moved above zero in line with the equivalent index
from the rest of the world. This week it was the German Ifo figures that surprised to the
upside. The Ifo expectations index jumped to 97.9 in December from 95.2 in November –
the highest level since May. This level is slightly below the average value for this index.
Ifo current conditions decreased to 107.1 from 108.1. Despite the decrease in the current
conditions this index has remained remarkably resilient in terms of the level. Germany
avoided recession in Q3 and the leading indicators for Q4 indicate that growth has been
stalling and negative growth in Q4 cannot be ruled out. The improvement in Ifo, PMI and
ZEW indicate improvement going forward, see also Flash Comment Germany: Ifo points
to further improvement, 19 December. The improvement in the leading indicators has
weakened the case for an ECB rate cut in January, which we never bought into.
US housing activity trending up
85 90 95 00 05 10
0.2
0.4
0.6
0.8
1.0
1.2
1.4
0
10
20
30
40
50
60
70
80

Index
Index
<< New home sales relevative
to 5yr moving average
NAHB
Source; Reuters EcoWin, Danske Bank


Economic surprise index is improving
in the euro area

Source: Macrobond, Danske Bank Markets

Leading indicators have bottomed
98 00 02 04 06 08 10 12
25
30
35
40
45
50
55
60
65
-75
-50
-25
0
25
50

75
100
125
Index
Index
<< ZEW expectations
Ifo expectations (minus 50) >>
PMI manufacturing >>
Source: Reuters EcoWin, Danske Bank





7 | 21 December 2012
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Weekly Focus

Weekly Focus
China: government signals status quo on economic policy
In China the Central Economic Work Conference (CEWC) was held 15-16 December.
CEWC is a joint meeting between the government and the leadership of China’s
Communist Party where the strategy for economic policy for 2013 is discussed. The
overall message from CEWC is status quo for macroeconomic policy and more focus on
longer-term structural reforms. Monetary policy will remain ‘prudent’, which is Chinese
terminology for neutral. Fiscal policy will remain ‘pro-active’, which usually means a
moderately loose fiscal policy. The statement from the meeting did not include specific
targets for GDP growth and inflation. However, according to press reports, the target for
GDP growth will remain unchanged at 7.5% and the inflation target for 2013 will be cut
to 3.5% from 4% for 2012. The government will probably not announce the target
officially until the National People’s Congress in March 2013. It should be remembered
that these targets for growth and inflation should not be regarded as forecasts but rather as
critical levels where the government feels it will have to respond with policy adjustments.
Japan: landslide LDP victory paves the way for more easing
The Liberal Democratic Party (LDP) won a landslide victory in connection with the
Lower House election and together with its usual coalition partner, New Komeito, LDP
will have a super-majority that allows the Lower House a possible majority in the Upper
House on some legislation, see
Flash Comment Japan: landslide LDP victory paves the
way for Abenomics, 17 December. Hence, LDP will be in a strong position to push
through its political agenda. The new prime minister Shinzo Abe’s first priority will be to
push Japan out of recession and the new government is expected to announce additional
fiscal easing soon after the government has been inaugurated on 26 December. The main
weakness with the Abe’s economic strategy is its apparent disregard for longer-term
structural economic reforms and consolidation of public finances. If a planned increase in
sales taxes in 2014 is postponed, Japan’s rating could be downgraded by the rating
agencies.

LDP has also been campaigning on more aggressive easing from Bank of Japan (BoJ) and
the new government will be in a strong position to influence BoJ through the appointment
of two new deputy board governors in March and a replacement for governor Masaaki
Shirakawa whose term expires in April. LDP has also opened up for possibly changing
the BoJ law to force BoJ to ease more aggressively. BoJ in connection with this week’s
monetary meeting expanded its asset purchase programme by JPY10trn to JPY76trn, see
Flash Comment Japan: BoJ could raise inflation target at next meeting, 20 December.
The implication is that the pace of BoJ’s asset purchases will accelerate slightly to close
to 9% of GDP in Q1 13 from about 8% of GDP in Q4 12. For comparison, the Fed’s
planned purchases of government bonds and mortgages is expected to be close to 6.5% of
GDP in 2013. Hence, monetary policy is already being eased quite aggressively in Japan.
In the statement BoJ also said it will discuss the inflation target at its next meeting on 20-
21 January. We now expect the inflation target to be raised from 1% to 2% in connection
with that meeting.

Status quo in China
Monetary Fiscal GDP Inflation
2007 Prudent Prudent 8.0% 3.0%
2008 Tight Prudent 8.0% 4.8%
2009 Loose Proactive 8.0% 4.0%
2010 Loose Proactive 8.0% 3.0%
2011 Prudent Proactive 8.0% 4.0%
2012 Prudent Proactive 7.5% 4.0%
2013 Prudent Proactive 7.5% 3.5%
Policy stance
Targets

Source: Danske Bank Markets

Asset purchases poised to accelerate
slightly next year
11 12 13
0
2
4
6
8
10
12
0
2
4
6
8
10
12
Pace of asset purcahses
%
Projected on current
announcements
%
(% of GDP annually)

Source: Bank of Japan, Danske Bank Markets

8 | 21 December 2012
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Weekly Focus











Weekly Focus
Scandi update
Denmark – fall in confidence has not hit spending
Thursday’s consumer confidence figures showed a fall from -1.3 in November to -4.7 in
December. Although the indicator typically falls slightly in December, the decrease was
somewhat larger than expected. Nevertheless, private consumption is moving in the right
direction: Thursday’s retail sales data for November showed an increase of 0.6% m/m and
the same picture emerges from Dankort debit card transactions, which trended upwards in
Q4. Finally, we released a new forecast for the Danish economy during the week. We
now expect the economy to expand by 0.7% in 2013 and 1.6% in 2014 after contracting
by 0.5% this year. This is not, however, expected to be enough to stabilise the Danish
labour market in the short term, so we will probably see a decrease in private sector
employment in 2013.

Sweden – expect another cut from the Riksbank in April
The Riksbank cut the repo rate by 25bp to 1.0% as expected earlier this week. The repo
path signals an unchanged rate from here and future hikes were again pushed out into the
future. The Riksbank justified the cut by arguing that recent economic developments
(including inflation) had been weaker than expected and that this weighed more than
households’ high debt ratio this time.
NIER’s December confidence survey rose slightly on the back of improving sentiment in
manufacturing and private services. That said, confidence is still at levels suggesting Q4
GDP growth will be negative with possible spillover to Q1 13. A worrying sign is that
consumer confidence plunged in December, probably on the back of the acceleration
deterioration of the labour market, which suggests that private spending may be in for a
squeeze over the next couple of months. This is also indicated in household spending
plans.
As downside risks still dominate the economic outlook, we have revised our call on the
Riksbank. We now see another 25bp rate in April. Unless there is a very sharp
deterioration in economic activity over the next couple of weeks, a February cut seems
unlikely as the Riksbank still wants to move very gradually.
Norway – nothing new from Norges Bank
As expected, Norges Bank left interest rates alone at the year’s last rate-setting meeting.
Also, there were no new signals about future interest rates. Indeed, deputy governor Jan
Qvigstad said that there was ‘no reason to amend the interest rate projections [from
October] and we are still assuming that the first rate increase will come in March, May,
June or September’. This was possibly somewhat less aggressive than many had expected
given the appreciation of the krone and the rate cut in Sweden. The reason for the bank
standing by the interest rate path published in October is quite simply that economic
developments have been largely as expected since then. The bank acknowledges that
growth in Europe may turn out weaker than it thought but a number of measures have
been agreed that could improve the situation. One interpretation of this is that the point
estimate for growth in Europe is now somewhat lower but so is the downside risk. The
absence of fresh signals from Norges Bank means that we still expect two hikes in

Norway in 2013. The biggest risk to our prediction is, of course, further appreciation of
the krone.

Consumer confidence fell in
December
05 06 07 08 09 10
11
12
-20
-15
-10
-5
0
5
10
15
20
-20
-15
-10
-5
0
5
10
15
20

Net. bal.
Net. bal.

Source: Reuters EcoWin


Plunging consumer confidence

Source: Macrobond


Strong NOK results in low rate

Source: Reuters EcoWin





9 | 21 December 2012
www.danskeresearch.com



Weekly Focus

Weekly Focus

EMEA Update
Fed , BoJ and BoE to help EMEA markets in 2013
2012 has been a surprisingly good year for the EMEA currencies and particularly the
Polish zloty and the Hungarian forint have seen fairly strong gains. We think there are
overall two reasons for the fairly positive performance. First of all, the euro crisis – even
though certainly not over – has eased somewhat and fears of a disintegration of the
European currency union have been reduced. Second and equally if not more important,
the Federal Reserve has stepped up monetary easing, which has done quite a bit to
improve global risk appetite and that is certainly positive for the EMEA currencies.
However, the positive performance of the EMEA currencies has effectively also meant a
tightening of monetary conditions in the region and this, combined with very weak
growth in most of the eurozone, has hurt EMEA growth over the past couple of months.
Fairly strong currencies and weak growth have triggered interest rate cuts across the
region in 2012 and we expect more monetary easing in 2013. Growth looks set to recover
slowly and inflationary pressures are nowhere to be seen.
Looking at 2013 we are fairly optimistic that most of the region’s currencies will do well
as the Bank of Japan and the Bank of England are likely to take the lead from the Federal
Reserve and step up monetary easing. That should make carry trades attractive –
something that certainly will help the EMEA currencies.
With currencies likely to remain fairly strong and to potentially get even stronger we
expect most EMEA central banks to continue to ease monetary policy. That should
eventually help the recovery to get under way in the region but we certainly do not expect
a boom in 2013.
Concluding, 2013 is likely to be a fairly good year for the EMEA currencies, rates should
continue to drop and we are likely to see a moderate recovery in growth across the region.

Read our trade recommendations for EMEA markets in 2013 in FX Top Trades 2013, 5
December (page 13 and 14) and in EM Bond Snapshot, 18 December.






Chief Analyst
Lars Christensen
+45 45 12 85 30

Analyst
Stanislava Pravdova
+45 45 12 80 71





10 | 21 December 2012
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Weekly Focus

Weekly Focus
Latest research from Danske Bank
20/12 Nordic Outlook - December 2012
Quarterly update on the Nordic economies.

20/12 Flash Comment - Japan: BoJ could raise inflation target at next meeting
Bank of Japan at today's monetary meeting raised the ceiling for its asset purchases by
JPY10trn to JPY76trn. It now looks increasingly likely that Bank of Japan will raise the
inflation target in January.

19/12 Flash Comment: Germany - Ifo points to further improvement
The Ifo expectations is rebounding in December and points to further improvement in the
coming months

18/12 Flash Comment - Riksbank update
The forecast update from the Riksbank released today is a fairly standard style document.
In short: temporary weakness in 2013 followed by a gradual return towards trend.

Danske Bank's EMU poll: Only one in eight Danes would definitely vote Yes to euro
Only one in eight Danes would vote Yes to the euro if a referendum were held today, the
lowest since our EMU survey began in 1999.

17/12 Yield Forecast Update - Curve steepening to continue

Monthly yield forecast update

17/12 Flash Comment - Japan: landslide LDP victory paves the way for Abenomics
The Liberal Democratic Party won a landslide victory in connection with the Lower
House election and LDP will be in a strong position to push through its political agenda.








11 | 21 December 2012
www.danskeresearch.com


Weekly Focus

Rates: The outlook for 2013
Where to search for yield next year?
This year has seen very good performance in almost every fixed income market. Core
markets, periphery, high yield and high grade have all performed very well. With central
bank rates at zero and long bond yields very low, many investors will ponder where to
pick up the yield next year. As always, it seems to be no easy task, but as always
opportunities will show up along the way. Many of them we cannot see yet but we outline
below some of the themes that we will be looking for next year.
# 1: Short end to stay anchored
Global central banks remain in easing mode and although there are signs of improvement
in both global and European economic data, the big central banks are not likely to raise

rates in the next couple of years. Hence, short rates will remain fairly anchored. This
implies that the environment for carry and roll down trades in the shorter end of the curve
will remain intact.
# 2: No big sell-off in EUR core 10-year segment
We believe that the 10-year segment will continue to be range bound through most of
H1 13. The recovery is set to remain moderate and central banks will focus on the huge
negative output gap in the economy. Currently, we are in the lower part of that range, but
if the economy improves, as we forecast, then we should move back to the higher end.
However, we do not expect German or Danish 10-year government bond yields to move
above 2% anytime soon.
# 3: Very long end to remain steep
Since June the very long end of the EUR swap curve has steepened. This is driven by the
change of the discount curve for the L&P sector in several countries. In Denmark, many
pension clients are now moving into market-based pensions. We expect this flow to
continue adding steepening pressure on the long end of the curve next year. Moreover, the
very aggressive balance sheet expansion from global central banks – most noteworthy the
Fed and BoJ – will eventually push long-term inflation and growth expectations higher, in
turn moving back-end forward rates higher.
# 4: US to underperform Europe
The spread between USD and EUR rates is expected to widen next year, as the US
macroeconomic outlook is better than the European. Furthermore, the Federal Reserve is
much more aggressive in its unconventional policy easing and credit is starting flow in
the US. Next year the Federal Reserve will print 6-7% of GDP, while the ECB balance
sheet could actually shrink as the banks pay back the LTRO money.
# 5: Spread compression to continue
The spread normalisation in the European periphery markets is expected to continue. The
ECB OMT is deemed credible by the markets and Spain and Italy are likely to return to
positive growth late next year. In the current low rate environment, we expect investors to
continue to move into lower credit and further out on the curve.
Returns in the fixed income markets

Source: Macrobond financial

Global government bond returns
Source: Macrobond financial

European government bond returns
Source: Macrobond financial


Senior Analyst
Peter Possing Andersen
+45 45 13 70 19

Senior Analyst
Lars Tranberg Rasmussen
+45 45 12 85 34





12 | 21 December 2012
www.danskeresearch.com


Weekly Focus
FX: More dollar and yen weakness in 2013
This week we updated our FX Forecasts for 2013. In general we expect yen, dollar and
sterling to suffer in 2013. For more see FX Forecast Update: Return of the SEK.
JPY looks particularly vulnerable in 2013 as further monetary easing from BoJ is in the

pipeline. At this week’s monetary policy meeting, BoJ said that it will discuss “the
medium- to long-term price stability” at its next meeting on 21-22 January. We expect the
BoJ to raise its inflation target from 1% to 2% at the meeting. The implication of a higher
inflation target will be that BoJ, all else being equal, will be forced to step up its asset
purchases and that the purchases will last for longer. Over the past couple of months, JPY
has already weakened significantly against both EUR and USD. But we argue that more
weakness is ahead in 2013. We forecast that EUR/JPY will rise to 118 and USD/JPY to
88 throughout 2013. Hence, we still recommend clients with income or assets in JPY to
use a significantly higher hedge ratio than normal.
ECB and Fed to support EUR against USD
Like BoJ, the Fed will also conduct a very aggressive monetary policy in 2013 as the
expiring Operation Twist programme will be replaced by outright treasury purchases of
USD45bn per month. We believe that the significant expansion of the Fed’s balance sheet
will weigh on the dollar in 2013, not least against carry currencies but also against the
euro. One of the first key events in 2013 will be the FOMC minutes on 3 January. Here
we will get more insight into the December Fed decision. But under all circumstances it
seems that the ECB will be clearly trailing both the Fed and BoJ in respect of monetary
easing in 2013, not least as a deposit rate cut after the latest ECB comments seems quite
unlikely in 2013. On top of that, we have recently seen a strong performance for
peripheral eurozone debt, underlining that tail risks for the euro continue to fall day by
day. We expect this peripheral debt performance to continue in 2013, which everything
equal lends support to the euro. Hence, we continue to see upside potential for EUR/USD
in 2013. One of the key risks for the market at the moment is the fiscal cliff. We expect
an agreement to be reached at the very last minute. It should further boost risk sentiment
and support the euro and weigh on the US dollar that has gained safe-haven support from
the fiscal cliff concerns. However, note that a fiscal cliff agreement will be reached has
probably now become the consensus view. Hence, if we are wrong, we could see
significant safe-haven support to USD in the beginning of 2013.
Still value in Scandies
Both the Riksbank and Norges Bank held monetary policy meetings this week. As

expected, the Riksbank cut rates by 25bp to 1.0% and said ‘once again’ that this was the
last rate cut in this cycle. Norges Bank kept rates on hold at 1.5% and repeated that rates
should go higher in 2013. Hence, both the NOK and SEK – on top of strong fundamentals
– are expected to be supported by relative rates in 2013. Note though that despite the
Riksbank assurance we expect a final rate cut from the Riksbank in April (a cut that is
more or less priced in the market). Hence, it should not create much more than a blip on
the continuous appreciation trend expected in the SEK in 2013.
More JPY weakness in 2013 when
inflation target is lifted

Source: MacroBond


Chief Analyst
Arne Lohmann Rasmussen
+4512 8532





13 | 21 December 2012
www.danskeresearch.com



Weekly Focus

Weekly Focus
Credit: Happy (Holi)days
Market commentary
Activity is dwindling towards the end of the year. In the secondary market it is mainly
smaller tickets that are coming through as the larger accounts have largely closed shop for
the year.
The primary market has also gone quiet but is likely to be back with a vengeance in the
new year. We are still of the view that credit investors are very cash rich and eager to play
ball in the primary market in the new year – hence we see a tightening potential in the
early part of 2013. If things turn out as they normally do, this will make issuers greedier
resulting in a squeeze of new issue premiums after which we are likely to have a minor
setback during which the market rebalances. The fiscal cliff negotiations are clearly a risk
factor that could cause some pain for credit if a solution is not found.
In terms of news flow, the Norwegian government has proposed to increase the risk
weights for residential mortgages to at least 35bp – i.e. as in the Basel II standard
approach. This is a severe tightening and is likely to cause some re-pricing of mortgage
lending if approved. There is a consultation period, which runs until March 1, and
therefore this is not a done deal. Furthermore, it will also have implications for the
capitalisation of the Norwegian banks – especially for the banks with large residential
mortgage portfolios. Our equity colleagues estimate that for DNB it will imply a
reduction of the core Tier 1 ratio of approximately 1 percentage point. Clearly the
Norwegian authorities are rather worried about Norwegian house prices and are now

taking more tangible measures to curb the ongoing price increases. If the end result is that
growth levels off and house prices stabilise, it is a good thing for credit. However, in the
short term the market may react to the lower capital ratios (although the underlying risks
are unchanged).


iTraxx Europe, 5Y CDS
0
50
100
150
200
250
Jul/09
Jan/10
Jul/10
Jan/11
Jul/11
Jan/12
Jul/12
bp

Source: Bloomberg, Danske Bank Markets

iTraxx Crossover, 5Y CDS
0
200
400
600
800

1,000
1,200
Jul/09
Jan/10
Jul/10
Jan/11
Jul/11
Jan/12
Jul/12
bp

Source: Bloomberg, Danske Bank Markets

Senior Analyst
Henrik Arnt
+45 45 12 85 04





14 | 21 December 2012
www.danskeresearch.com



Weekly Focus

Weekly Focus
Financial views
Equities
• The equity market has already discounted a moderate recovery in the business cycle
and we see a risk of a market correction on weak Q4 corporate earnings and clear
uncertainty regarding the economic effects of the overall global policy mix (fiscal and
monetary policy) from the start of 2013. We lowered our recommendation on equities
to Neutral in late August and before we can take steps to over- or underweight
equities we need more clarity on the 2013 scenario. For now, we recommend
overweighting European equities, particularly Retail, Industrials, DAX and European
equities.
Fixed income
• We believe that the 10yr segment will continue to be range bound through most of H1
13. The recovery is set to remain moderate and central banks will focus on the
substantial negative output gap in the economy. Currently, we are in the lower part of
that range, but if the economy improves, as we forecast, then we should move back to
the higher end. However, we do not expect German or Danish 10yr government bond
yields to move above 2% anytime soon.
• We are overweight Scandinavia versus Euroland.
Credit
• Liquidity is becoming more shallow as we approach year-end. We believe investment
grade credit continues to benefit from offering a relatively safe harbour that still offers

a pick-up to depressed government bond yields.
• On the back of a strong investor bid, our base case is a slight spread tightening as the
most likely scenario going into 2013. However, the spread tightening potential from
current levels is not significant as we see it and risk-reward seems asymmetrical due
to debt crisis contagion. Given the relatively steep credit curves, we see most value
beyond three- to four-year maturities.
FX
• The discussion about of a negative deposit rate in Europe has disappeared and
peripheral debt markets have performed strongly removing more tail-risk from the
euro. This together with Fed stepping up its easing programme has pushed EUR/USD
above 1.32. We continue to expect relative monetary policy, the global cyclical
outlook and less tail-risk attached to the euro to support EUR/USD in 2013. Sterling
is expected to weaken along USD in 2013.
• We are quite negative on JPY. The Bank of Japan is turning much softer and the
political pressure on the bank to ease monetary policy further is high, not least after
the LDP won a landslide victory in the general election. We continue to see EUR/JPY
and USD/JPY moving higher in 2013.
• EUR/SEK has moved lower lately after the Riksbank said that no more rate cuts are to
be expected in 2013. We see further support to the krona, as it is expected to benefit
from a global growth stabilisation/recovery in 2013. NOK continues to be supported
by Norges Bank that repeated this week that rates will go up in 2013. EUR/DKK is

Equities and US 10Y yield

Source: Reuters EcoWin

EUR/USD and USD/JPY

Source: Reuters EcoWin
Credit spreads

Source: Reuters EcoWin
Commodity prices

Source: Reuters EcoWin




15 | 21 December 2012
www.danskeresearch.com



Weekly Focus











Weekly Focus
once again trading close to the central parity at 7.46038. We expect the Danish central
bank to keep the cross from moving significantly higher through intervention before
resorting to an independent rate hike. An independent Danish rate hike has probably

moved closer after the latest price action in EUR/DKK.
Commodities
• We see limited potential for commodities to move higher in the near term as risk
appetite is likely to suffer from fiscal cliff concerns. With a little help from the game-
changing moves of major central banks and a stabilisation in Chinese activity, we
continue to see some upside for prices early in 2013 but, as a whole, 2013 is set to be
challenging in terms of demand. With the Saudis set to continue their oil equivalent of
quantitative easing, oil prices should head below USD100/bbl late next year
(geopolitics aside).





16 | 21 December 2012
www.danskeresearch.com



Weekly Focus

Weekly Focus
Macroeconomic forecast
Macro forecast, Scandinavia
Denmark
2012 -0.5 1.1 0.0 1.8 -0.6 1.8 3.2 2.4 6.2 -4.0 41.9 5.9
2013 0.7 1.3 0.6 2.1 0.0 1.6 2.9 1.5 6.5 0.3 41.2 4.8
2014 1.6 1.2 0.8 -1.5 0.0 3.6 2.0 1.7 6.5 -1.8 38.1 4.9
Sweden
2012 0.9 1.4 0.4 3.1 -0.8 0.4 -0.4 0.9 7.7 -0.5 37.7 7.0
2013 1.2 1.8 0.7 0.4 0.1 1.9 2.4 0.4 8.5 -1.1 37.9 7.5
2014 2.0 1.5 0.5 0.8 -0.1 3.8 1.8 2.5 8.0 -1.0 38.1 7.1
Norway
2012 3.3 3.1 1.9 6.3 0.1 2.0 2.1 0.7 3.0 - - -
2013 3.1 3.5 2.1 5.0 0.1 0.6 4.6 1.8 3.0 - - -
2014 3.4 3.5 2.0 6.0 0.0 1.5 5.0 2.2 3.0 - - -
Macro forecast, Euroland
Euroland
2012 -0.4 -0.9 0.0 -3.3 -0.6 2.4 -0.7 2.7 11.4 -3.4 90.1 1.1
2013 0.3 -0.2 -0.3 -0.7 0.0 1.9 0.9 1.8 12.1 -2.5 92.2 1.5
2014 1.3 0.4 -0.3 2.2 0.1 4.4 3.1 1.8 12.2 -2.6 93.5 1.6
Germany
2012 1.0 0.5 1.0 -4.4 0.0 5.0 2.6 2.5 7.1 -1.0 81.2 5.1
2013 1.1 0.3 0.5 -1.6 0.0 4.9 3.4 2.0 6.9 -1.1 82.4 4.5
2014 1.9 1.0 0.9 4.6 0.0 4.5 4.5 1.8 6.9 -0.8 81.1 4.3
France
2012 0.1 -0.1 1.3 0.4 1.5 2.5 0.1 2.3 9.6 -5.2 85.8 -2.7
2013 0.2 0.0 0.3 0.3 -0.1 2.5 1.5 2.1 10.2 -4.7 90.8 -2.5
2014 0.9 1.1 0.0 1.6 0.0 4.4 4.3 1.7 10.4 -4.0 92.8 -2.2
Italy

2012 -2.0 -3.2 -0.8 -7.7 -0.8 1.0 -7.2 2.9 8.4 -4.1 120.1 -3.1
2013 -0.4 -0.9 -0.4 -1.3 0.0 3.5 2.3 3.0 10.6 -2.4 124.2 -2.5
2014 1.1 1.1 -0.4 2.3 0.0 4.1 4.1 2.0 11.1 -1.3 122.3 -1.5
Spain
2012 -1.3 -1.7 -3.9 -8.6 0.5 3.9 -3.6 3.0 21.7 -8.5 68.5 -3.5
2013 -1.5 -2.1 -4.1 -4.3 0.0 7.5 3.6 1.9 24.9 -7.0 84.5 -2.8
2014 0.3 -0.5 -2.0 2.4 0.0 4.7 3.6 1.7 26.4 -5.5 92.0 -0.5
Finland
2012 0.0 1.7 -0.5 -2.5 - -1.5 -1.5 2.8 7.7 -1.5 52.5 -1.5
2013 0.5 0.8 0.0 -1.0 - 1.5 1.0 2.5 8.2 -0.7 54.5 -1.0
2014 2.2 1.3 0.5 2.5 - 4.5 3.0 2.0 7.9 -0.5 55.0 -0.5
Macro forecast, Global
USA
2012 2.3 1.8 -1.4 8.1 0.2 3.9 2.8 2.2 8.1 -8.6 100.0 -3.0
2013 2.1 1.6 -0.4 6.1 0.0 5.0 2.8 2.3 7.5 -7.7 102.0 -2.5
2014 2.8 2.3 -0.8 8.9 0.1 6.8 6.1 1.7 6.8 -6.3 102.0 -2.5
Japan
2012 1.6 2.1 2.2 2.8 0.1 0.8 5.7 -0.2 4.5 -10.1 229.7 1.6
2013 0.7 0.6 1.2 2.2 0.0 -0.9 2.2 0.1 4.4 -0.5 238.6 2.3
2014 1.3 1.2 1.0 0.9 - 6.0 4.7 0.2 4.4 -7.5 245.0 1.9
China
2012 7.7 - - - - - - 2.7 4.3 -1.3 22.2 2.5
2013 8.6 - - - - - - 2.9 4.3 -1.0 19.6 2.9
2014 8.3 - - - - - - 3.1 - -0.8 17.2 3.4
UK
2011 0.7 -0.8 0.3 -2.0 1.1 4.2 2.0 4.5 8.5 -8.3 82.5 -2.0
2012 -0.2 0.3 0.5 2.0 1.3 -0.4 3.3 2.7 8.8 -8.0 88.4 -1.5
2013 1.2 1.0 -1.1 2.0 1.3 2.0 3.5 2.0 8.5 -6.5 91.4 -1.2
Current
acc.

4
GDP
1
Private
cons.
1
Public
cons.
1
Fixed
inv.
1
Stock
build.
2
Ex-
ports
1
Im-
ports
1
Infla-
tion
1
Unem-
ploym.
3
Public
budget
4

Public
debt
4
Year
Year
GDP
1
Private
cons.
1
Public
cons.
1
Fixed
inv.
1
Stock
build.
2
Ex-
ports
1
Im-
ports
1
Infla-
tion
1
Unem-
ploym.

3
Public
budget
4
Current
acc.
4
Public
debt
4
Current
acc.
4
Im-
ports
1
Public
debt
4
Public
budget
4
Ex-
ports
1
Infla-
tion
1
Unem-
ploym.

3
Year
GDP
1
Private
cons.
1
Public
cons.
1
Fixed
inv.
1
Stock
build.
2

Source: OECD and Danske Bank. 1) % y/y. 2) % contribution to GDP growth. 3) % of labour force. 4) % of GDP.





17 | 21 December 2012
www.danskeresearch.com



Weekly Focus

Weekly Focus
Financial forecast

Bond and money markets
Currency
vs USD
Currency
vs DKK
USD 21-Dec - 564.6
+3m - 557
+6m - 553
+12m - 565
EUR 21-Dec 132.2 746.1
+3m 134 746.0
+6m 135 746.0
+12m 132 746.0
JPY 21-Dec 84.2 6.71
+3m 85 6.54
+6m 87 6.32
+12m 88 6.43

GBP 21-Dec 162.5 917.3
+3m 161 899
+6m 159 878
+12m 159 899
CHF 21-Dec 91.4 617.7
+3m 90 617
+6m 90 611
+12m 92 617
DKK 21-Dec 564.6 -
+3m 557 -
+6m 553 -
+12m 565 -
SEK 21-Dec 650.5 86.8
+3m 634 87.8
+6m 622 88.8
+12m 636 88.8
NOK 21-Dec 556.1 101.5
+3m 537 103.6
+6m 530 104.3
+12m 538 105.1
Equity markets
Regional
Price trend
12 mth.
Regional recommen-
dations
USA Affected by fiscal cliff fears 5%-10% Underweight
Emerging markets (USD) Awaiting Chinese recovery 5%-10% Neutral
Europe (ex. Nordics) (EUR) Euro area crisis to abate 10%-15% Overweight
Nordics Strong macro balances 5%-10% Neutral

Commodities
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2012 2013
NYMEX WTI 103 93 92 97 103 100 97 94 96 99
ICE Brent 118 109 109 111 115 110 105 100 112 108
Copper 8,329 7,829 7,730 7,900 8,250 8,300 8,300 8,300 7,947 8,288
Zinc 2,042 1,932 1,908 1,875 1,865 1,855 1,845 1,835 1,939 1,850
Nickel 19,709 17,211 16,432 16,750 16,850 16,950 17,050 17,150 17,525 17,000
Steel 522 457 380 385 380 375 370 365 489 373
Aluminium 2,219 2,019 1,952 1,975 1,965 1,955 1,945 1,935 2,041 1,950
Gold 1,690 1,612 1,656 1,681 1,706 1,731 1,756 1,781 1,660 1,743
Matif Mill Wheat 210 212 259 250 240 230 220 210 233 225
CBOT Wheat 643 641 872 841 793 745 713 680 749 733
CBOT Corn 641 618 782 775 765 755 745 735 704 750
CBOT Soybeans 1,272 1,426 1,675 1,625 1,575 1,525 1,475 1,425 1,500 1,500
0.50
Average
Key int.
rate
0.25
0.25
0.25
0.25
1.75
0.00
0.75
0.75
0.10
0.10
0.50
10-yr swap yield

1.30
0.20
0.40
0.40
3m interest rate
2.15
0.75
0.10
0.50
0.00
0.20
0.18
0.50
0.50
0.50
0.00
0.00
0.75
0.50
1.30
1.00
0.10
0.28
1.50
1.00
0.75
0.75
1.50
1.75
0.31

0.18
0.18
0.52
0.01
0.30
0.30
0.35
0.18
0.18
0.05
0.20
0.20
0.20
0.05
0.05
0.35
0.30
0.40
1.20
1.20
1.83
715
1.95
2.15
2.15
2.30
-
2.45
-
0.45

0.60
0.65
0.15
0.15
0.20
1.23
-
0.40
0.45
0.65
0.65
0.65
0.25
0.25
0.25
134
135
132
114
118
116
0.79
132.2
-
-
-
-
111.2
746
746

746
859.7
734.9
710
850
840
840
720
81.3
120.8
746.1
83.0
85.0
83.0
121
122
121
0.40
0.38
0.22
0.72
0.05
0.56
0.35
0.40
0.40
0.35
2.09
Currency
vs EUR

2-yr swap yield
Risk profile
3 mth.
Medium
-5% to +5%
Price trend
3 mth.
Medium
High
701
21-Dec
-5% to +5%
-5% to +5%
89
17,575
7,770
2,071
1,652
249
109
315
2,061
2013
2012
1.85
1.82
2.00
2.30
1.75
1.95

2.15
0.80
0.90
1.05
1.94
2.00
2.15
2.35
0.94
1.05
1.15
1.25
3.30
2.05
2.30
1.80
2.10
-
1.75
Medium
-5% to +5%
1,419
794
1.62
-
-
3.17
3.15
3.20

Source: Danske Bank Markets





18 | 21 December 2012
www.danskeresearch.com



Weekly Focus











Weekly Focus
Calendar – Key Data and Events in Week 52


Tuesday, December 25, 2012
Period Danske Bank Consensus Previous
13:00 EUR ECB announces allotment in 7-day term deposits

Wednesday, December 26, 2012
Period Danske Bank Consensus Previous
6:00 JPY Small business confidence Index Dec 43.3
Thursday, December 27, 2012
Period Danske Bank Consensus Previous
6:00 JPY Housing starts y/y Nov 10.7% 25.2%
8:45 FRF Consumer confidence Index Dec 84 84
10:00 ITL Business confidence Index Dec 88.9 88.5
10:30 GBP BBA loans for house purchase Number Nov 33039
14:30 USD Initial jobless claims 1000 366 361
16:00 USD Consumer confidence Index Dec 70.0 70.0 73.7
16:00 USD New home sales 1000 (m/m) Nov 374 (1.5%) 380 (3.3%) 386 (-0.3%)
Friday, December 28, 2012
Period Danske Bank Consensus Previous
0:15 JPY Markit/JMMA manufacturing PMI Index Dec 46.5 46.5
0:30 JPY Unemployment rate % Nov 4.3% 4.2% 4.2%
0:30 JPY Household spending y/y Nov 0.7% -0.1%
0:30 JPY Job-to-applicant ratio Nov 0.79 0.80 0.80
0:30 JPY CPI - national y/y Dec -0.2% -0.4%
0:30 JPY CPI - national ex. fresh food y/y Nov -0.1% -0.1% 0.0%
0:30 JPY CPI - Tokyo y/y Dec -0.6% -0.5%
0:30 JPY CPI - Tokyo ex fresh food y/y Dec -0.5% -0.5%
0:50 JPY Retail trade m/m|y/y Nov 0.4%|1.1% 0.7%|-1.2%
0:50 JPY Large retailers' sales y/y Nov -0.4% -3.2%
0:50 JPY Industrial production, preliminary m/m| y/ y Nov -1.1%| 1.6%|-4.5%
2:30 JPY Labor cash earnings y/y Nov 0.2%
8:45 FRF GDP, final q/q|y/y 3rd quarter 0.2%| 0.2%|0.1% 0.2%|0.2%
8:45 FRF Household consumption m/m|y/y Nov -0.2%|-0.5%
9:30 SEK Trade balance SEK bn Nov 8.0
9:30 SEK Wages (blue collars/white collars) y/y Oct 2.7%

9:30 SEK Retail sales s.a. m/m|y/y Nov -1.7%|1.2%
11:15 EUR ECB announces allotment in 6day (MRO)
15:45 USD Chicago PMI Index Dec 53.6 51.0 50.4
16:00 USD Pending home sales m/m Nov 0.0 % -0.5% 5.2%
23:00 USD Fed's Stein and Kocherlakota speak
During the week
Period Danske Bank Consensus Previous
Thu 27 - 31 GBP Nationwide House Prices m/ m|y/y Dec 0.1%|-0.9% 0.0%|-1.2%
The editors do not guarantee the accurateness of figures, hours or dates stated above
For furher information, call (+45 ) 45 12 85 22.

Source: Danske Bank Markets





19 | 21 December 2012
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Weekly Focus

Weekly Focus
Calendar – Key Data and Events in Week 1


Period Danske Bank Consensus Previous
2:45 CNY HSBC manufacturing PMI Index Dec 51.2 50.9 50.5
20:10 DEM Merkel's New Year speech
Tuesday, January 1, 2013
Period Danske Bank Consensus Previous
2:00 CNY NBS PMI manufacturing Index Dec 51.0 51.0 50.6
Wednesday, January 2, 2013
Period Danske Bank Consensus Previous
8:00 EUR Ireland, PMI manufacturing Index Dec 52.5 52.4
8:30 SEK PMI Index Dec 43.2
9:00 ESP HICP, preliminary y/y Dec 3.0%
9:15 ESP PMI manufacturing Index Dec 45.5 45.3
9:45 ITL PMI manufacturing Index Dec 45.5 45.1
9:50 FRF PMI manufacturing, final Index Dec 44.6 44.6
9:55 DEM PMI manufacturing, final Index Dec 46.3
10:00 EUR PMI manufacturing, final Index Dec 46.3 46.3
10:30 GBP PMI manufacturing Index Dec 49.0 49.1
11:00 EUR ECB announces allotment in 7-day (USD)
11:00 EUR ECB announces allotment in 3-month (USD)
14:00 DEM HICP, preliminary m/m|y/y Dec -0.2%|1.9%
14:58 USD Markit manufacturing PMI, final Index Dec 52.8
16:00 USD Construction spending m/m Nov 1.4%

16:00 USD ISM manufacturing Index Dec 49.5
16:00 USD ISM prices paid Index Dec 52.5
16:00 DKK Currency reserves DKK bn Dec 512.1
18:00 ITL Budget balance (year to date) EUR bn Dec -62.9
Thursday, January 3, 2013
Period Danske Bank Consensus Previous
9:00 NOK PMI Index Dec 50.1
9:30 SEK Household Lending % Nov 4.5% 4.5%
9:55 DEM Unemployment rate % Dec 6.9%
10:00 EUR M3 money supply y/y Nov 3.5% 3.4% 3.1%
10:30 GBP PMI construction Index Dec 49.8 49.3
10:30 GBP Mortgage approvals 1,000 Nov 54.0 53.0
10:30 GBP Broad money M4 m/m|y/y Nov 0.2%|-3.2%
11:15 EUR ECB announces allotment in 6-day (MRO)
13:00 USD MBA Mortgage Applications m/m -12.3%
14:15 USD ADP employment 1000 118
20:00 USD Minutes from FOMC meeting
23:00 USD Total Vehicle Sales m Dec 15.46
Monday, December 31, 2012

Source: Danske Bank Markets






20 | 21 December 2012
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Weekly Focus











Weekly Focus
Calendar - continued
Friday, January 4, 2013
Period Danske Bank Consensus Previous
2:45 CNY HSBC services PMI Index Dec 52.1
8:00 EUR Ireland, PMI services Index Dec
8:45 ITL PMI services Index Dec 45.0 44.6
9:00 DKK Gross unemployment s.a. K (%) Nov
166.500 (6.4%)
165.500 (6.3%)
9:00 DKK Confidence indicator, industry Index Dec 0 2
9:15 ESP PMI services Index Dec 42.5 42.4
9:50 FRF PMI services, final Index Dec 46.0 46.0 46.0
9:55 DEM PMI services, final Index Dec 52.1 52.1
10:00 EUR PMI services, final Index Dec 47.8 47.8 47.8
10:00 EUR PMI composite, final Index Dec 47.3 47.3 47.3

10:30 GBP PMI services Index Dec 50.2 50.2
11:00 EUR CPI estimate y/y Dec 2.3% 2.2%
11:00 ITL HICP, preliminary m/m|y/ y Dec -0.3%|2.6%
14:30 USD Nonfarm payroll 1000 Dec 146
14:30 USD Private payrolls 1000 Dec 147
14:30 USD Unemployment Dec 7.7%
14:30 USD Manufacturing payrolls 1000 Dec -7
14:30 CAD Net change in employment 1,000 Dec 0.0 59.3
16:00 USD Factory Orders m/ m Nov 0.8%
16:00 USD ISM (NAPM) non-manufacturing Index Dec 54.7
19:15 USD Fed's Plosser (non-voter, hawk) speaks
21:30 USD Fed's Yellen (voter, dove) speaks
23:30 USD Fed's Bullard (non-voter, neutral) speaks
23:00 USD Fed's Stein and Kocherlakota speak
During the week
Period Danske Bank Consensus Previous
Thu 27 - 31 GBP Nationwide House Prices m/m| y/ y Dec 0.1%|-0.9% 0.0%|-1.2%
Wed 02 - 04 GBP Halifax house prices
m/m|3Ms/YoY
Dec 0.0%|-0.7% 1.0%|-1.3%
Sat 05 USD Fed's Plosser (non-voter, hawk) speaks
Sat 05 USD Fed's Yellen (voter, dove) speaks
The editors do not guarantee the accurateness of figures, hours or dates stated above
For furher information, call (+45 ) 45 12 85 22.

Source: Danske Bank Markets

21 | 21 December 2012
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Weekly Focus











Weekly Focus

Disclosure
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Weekly Focus
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